Preamble

The House met at Eleven o'clock

PRAYERS

[Mr. Speaker in the Chair]

NEW WRITS

For Southwark, in the room of the right honourable Raymond James Gunter (Chiltern Hundreds).—[Mr. Mellish.]

For Kingston-upon-Thames in the room of Major the right honourable John Archibald Boyd-Carpenter (Member and Chairman of the Civil Aviation Authority).—[Mr. Pym.]

RAILWAYS (DISPUTE)

Mr. Arthur Lewis: On a point of order, Mr. Speaker. I would ask you whether, in view of the seriousness of the situation and the fact that the Chancellor of the Exchequer seems to make it worse, the Government have been asked to make any statement about the impending rail chaos.

Mr. Speaker: The hon. Member is well aware that that is not a matter of order.

Orders of the Day — NATIONAL HEALTH SERVICE (FAMILY PLANNING) AMENDMENT BILL

Order read for resuming adjourned debate on Third Reading [24th March].

Question again proposed, That the Bill be now read the Third time.

11.7 a.m.

Mr. Phillip Whitehead: I shall not detain the House long. I am well aware that this Bill has already occupied a great deal of the time allocated, under the proceedings of the House, to Private Members' Measures, and it was my good fortune, as a comparatively new Member, to secure the premier place to be able to introduce such a Measure this Session. All I would wish to do at this late stage in the passage of the Bill is to say that I have been gratified throughout by the speeches of hon. Members on Second Reading, in Committee and on Report, and also by the very considerable correspondence, which all of us have received and to which so many hon. Members have referred during the debates, on this subject, correspondence which has been almost unanimously in support of this comparatively modest Measure. The Press support has been additionally gratifying in view of the fact that there were a considerable number of misunderstandings about the nature of this Measure when we first introduced it.
I think that the debates in the House and in the Standing Committee and the nature of the Press comment which we have received have alleviated many fears, and, as I shall show in a moment, the assurances we have gained from the hon. Member for Barkston Ash (Mr. Alison), Under-Secretary of State for Health and Social Security, in the Committee and the House have been a further source of satisfaction by setting many minds at rest.
Press comment has not been unanimous in support of this Measure, nor, indeed, has it been altogether accurate in reporting. The Daily Telegraph, reporting the debate on Report on 24th March and the Third Reading debate which then began, erroneously reported,


I noted, that the hon. Member for Glasgow, Hillhead (Mr. Galbraith), who is not, alas in his place today, had talked the Bill out. Not for the first time the Daily Telegraph was confused in its reporting of the proceedings of this House. However, I am gratified by those hon. Members who have sustained the Bill so far to its Third Reading, and I am sure they will give it overwhelming support on Third Reading today.
When the then hon. Member for Bebington, Mr. Edwin Brooks, introduced the parent Act—the National Health Service (Family Planning) Act, 1967—he said that he regarded it as the first step towards a comprehensive family planning service within the National Health Service. I regard the Bill, which amends that parent Act, as another small step in that direction. I am extremely glad to see that opinion on all sides in the country is moving rapidly in this direction, including opinion in some quarters where there has been undue scepticism about the need for the rôle of the National Health Service in this area.
Last week in its report "Unplanned Pregnancy" the Royal College of Obstetricians and Gynaecologists under the distinguished chairmanship of Sir John Peel showed that the Royal College had come to much the same conclusions as the Committee which dealt with the Bill and the House of Commons. Recommendation 16 of that report said:
There is a rapidly increasing practice of both male and female sterilisation and a much greater acceptance of this procedure by married couples who have reached the decision that they do not wish to have more children.
It recommended strongly that this should be encouraged within the National Health Service.
I am satisfied with the assurances that we have received in Committee and the way in which several Amendments have been accepted by the proponents of the Bill. Some will need further consideration in another place in the light of the reservations which have been expressed by several hon. Members, including my hon. Friend the Member for Pontypool (Mr. Abse). There are complexities to the operation and in the follow-up procedures and long-term consequences which we need to keep under the closest scrutiny. Hon. Members on both sides

of the House have been right to stress this.
I am happy that the Under-Secretary of State, who has been a model of patience and courtesy in Committee and on Report, by the departmental circulars and the working party which will be set up to advise his Department on the implementation of the Bill, has given us a more adequate guarantee that all possible complexities will be fully advised upon and met.
I wish to mention the help and advise I have been given by the Department particularly the Chief Medical Officer, and those who have sustained the Bill in its sometimes controversial passage through the House since 21st January, notably the Conservation Society, the Family Planning Association and most particularly the Birth Control Campaign, which has laboured hard in London and in the constituencies reminding hon. Members of the need for the Bill and has been a great source of support to me throughout.
The hon. Members for Yarmouth (Mr. Fell) and Chigwell (Mr. Biggs-Davison) have made it clear that they do not like the Bill. They regard it as a self-mutilation Measure and do not wish to see it upon the Statute Book. They are not perhaps experts in self-mutilation, although in Committee they became experts in self-closure. The tenacity of their opposition has been throughout a stimulus to us and I thank them for their constant attendance during the Committee and Report stages and for the way in which throughout in seeking assurances they, like my hon. Friend the Member for Pontypool, have made the Bill tighter. I know they object to the whole principle but they would be the first to agree that by getting the assurances we have received on the implementation of the Bill if it becomes law they have tightened up considerably the procedures under which it will be applied.
I also thank those who have come to the House, often from great distances at their own expense, to tell hon. Members and noble Lords about the need for the Bill, particularly Professor Blandy of the London Hospital and Dr. Pauline Jackson who began the first of the family planning clinics specialising in vasectomy in Cardiff. They and, in his sagacity


throughout, the Clerk of the Public Bill Office, Mr. Ryle, have helped me on my fumbling and ignorant way through the passage of the Bill. It is not always easy for a new Member of Parliament to steer a passage through the intricacies of the procedure of the House.
I regard it as a special privilege in my second Session here to have the good fortune to steer a Private Member's Bill through the House of Commons. I have been sustained by the overwhelming support of hon. Members on both sides of the House, and I thank them all. I salute and thank those hon. Members who have opposed the Bill and, in the confidence that it has the overwhelming support of the country and the House of Commons, I commend it to the House.

Mr. John Biggs-Davison: Before the hon. Member for Derby, North (Mr. Whitehead) sits down, since I have exhausted my right to speak on Third Reading, may I interrogatively ask him whether he realises that we who have most strongly disagreed with the Measure appreciate his courtesy and consideration throughout the proceedings?

11.16 a.m.

Dr. Tom Stuttaford: I congratulate the hon. Member for Derby, North (Mr. Whitehead). Throughout the passage of the Bill he has remained courteous and polite and during the proceedings in Committee when other people were irritable he was a model of tact and charm.
The Bill, even in its amended form, is only an amending Bill and is no great revolutionary step forward, but it tends to reflect the opinion of the country and of Parliament. A recent poll taken throughout the country on contraception and family planning showed that even in those areas which are normally opposed to family planning such as Liverpool and parts of the North-West, 67 per cent. of Conservative voters and 65 per cent. of Socialist voters were in favour of the Pill being made available on the National Health Service. There is a desire for an extension of family planning and the Bill extends family planning in one respect a little further.
We are very grateful to the Under-secretary, my hon. Friend the Member

for Barkston Ash (Mr. Alison), for all his trouble. Speaking as he does for the Government, he has reflected not only the feeling of the Government but also the feeling of the populace at large.
We understand opposition to the Bill on religious grounds. We are only too prepared to accept other people's religious views. We are not so ready to accept opposition to the Bill when it goes into the realms of medicine. Many of the medical arguments against the Bill are over-stressed if not inaccurate. The Minister's recommendations to local authorities will have put completely at rest the minds of those who were opposing the Bill on medical grounds. A compromise has been reached on where the operation should take place and, if doctors take into account the Department's views, there should be no trouble from this point of view.
In my welfare session last Saturday morning a woman came to see me from one of the poorest and most dreary districts of Norwich. She had seen on television a programme in which the Bill had been discussed. She took the trouble to come in to the centre of the city to see me and she said "I am the mother of six children. How I wish, when I was having my children 10, 15 or 20 years ago, there had been people to get up in Parliament and push family planning as it is being pushed today and that there had been a Government which would listen to them."
I should be surprised if that woman was a Conservative voter, but she took the trouble to come to see me to offer her best wishes for today. She felt—and she was a woman of little education—that the Bill was made for such people as herself so that their families could be planned, that every child should be a wanted child and that conception should be a matter of choice and not chance.
I should like to thank all the people who have done such tremendous background work on the Bill. I end by once again thanking the hon. Member for Derby, North for the way in which he has handled the Bill and, above all, I should thank the Ministers for their co-operation, kindliness and advice which they have given us and for that which in future they will give to local authorities.

11.20 a.m.

Mr. Leo Abse: I join in the congratulations to my hon. Friend the Member for Derby, North(Mr. Whitehead) who has steered the Bill through the House. Such a task for a comparatively new Member means that he goes through a period of considerable political maturation and emerges much wiser than when he began.
My hon. Friend has been extremely courteous throughout all stages of his Bill. The House owes a particular debt to the Under-Secretary of State who by his readiness to listen, his accessibility and his elasticity has shown his awareness that we are here dealing with a Bill which impinges on human relationships and which needs to be approached not with ideology but with delicacy.
I hope that just as my hon. Friend the Member for Derby, North has achieved political maturation, some of his co-sponsors will also have achieved a similar state in seeing the Bill through to its final form, a form which all will hope will lead to success.
We have heard views expressed with considerable skill and pertinacity by the hon. Member for Chigwell (Mr. Biggs-Davison), and the hon. Member for Yarmouth (Mr. Fell), to whom the House owes a considerable debt of gratitude. Though they have expressed a minority view, such a view must of course be taken into account. The House is aware that we must have regard for all those who in their various ways pay respect to the sanctity of life and who never flinch from that course. At a time when there can be too little reverence for life, it is important that those spokesmen who place great value on it in all circumstances should be listened to and have their views fully considered in terms of the Bill as it has finally emerged.
The Bill in its present and final form, together with the circulars which will be issued both administratively and medically, will make a contribution to family happiness. It is not a Measure which, if we continue to maintain vigilance, will yield to the aberrant masochism which exists in the community, which can express itself in a form that is eccentric and which can lead to self-abasement and against which we must always protect ourselves.
Furthermore the Bill will act as a pilot experiment until the health services are organised within a matter of years. Those who will now have responsibility for working and co-operating with local authorities in implementing the Bill should be aware that they are on trial and on test. Clearly the experiences which emerge from the working of the Bill will shape the opinion of those of us who will be here when the reorganisation of the health services takes place, when it is hoped that there will be an even more comprehensive family planning service available for the nation. If in any way the Ministry circulars are treated too perfunctorily and are insufficiently spelt out so as to cause ambiguity, there may arise cause for public concern. I hope that this will fall short of scandals such as those which followed the Abortion Act since this could express itself in a backlash against the whole family planning services.
I trust that those who support the Bill in the local authorities will use its provisions with care. I hope that they will use the Bill fully but will have due regard for the needs of screening and the high physical standards which are required. I hope they will be aware of the needs which both the British Medical Association and the Medical Defence Union have said must be constantly taken into account. I am confident that if the Bill is used in this way with all working in co-operation, it will be a worthy successor to the initial family planning legislation in which I had the opportunity of associating with Edwin Brooks. This will mean that both pieces of legislation will have presaged the comprehensive family planning service, which is concerned with the quality of life and which one must always regard as essential.
My hon. Friend the Member for Derby, North has carried out an excellent job in bringing the Bill forward and in sponsoring it in the manner in which he has, together with the efforts of the Under-secretary of State. The House must feel that it has done a job that is worthy of this institution.

11.29 a.m.

Mr. Geoffrey Finsberg: I regret that I was not present on the previous occasion when the House debated the Third Reading of the Bill. I


read the proceedings with great interest and I give the Bill my warm support.
This is a small, modest, voluntary Measure and it is important that nobody should gain the impression that it will compel anybody to have to accept any form of family planning. It merely widens the opportunities. There is clear public sympathy and support for the Measure. I was told by my two predecessors that the Hampstead constituency and one other constituency have the largest postbags. I average 35 to 40 letters a day, and I have had only one letter expressing opposition to the concept of the Bill. If there was any burning opposition to the Bill, it would have been reflected in my mailbag. Subjects of similar public interest such as conservation have excited a good deal more response. For example, on the importation of whale meat there were more than 20 letters. Clearly there is no burning public opposition to this idea.
The Bill will make its small contribution to our population problems, and they are problems which are pressing on us more and more. It is a better Bill than the original. It now contains a Clause which will give us statistics on which we can base future judgments. Until now everything has been based very much on information supplied by this or that organisation, by this or that lobby or by sheer emotionalism. The Bill will give us the basis of statistics on which we can judge when we come to consider future legislation or when we come to consider this matter in any other way.
I am grateful for what has been said on several occasions by my hon. Friend the Under-Secretary of State. I regard ministerial circulars as extremely important. I think I can say to the hon. Member for Pontypool (Mr. Abse) that, in the main, local authorities pay great attention to circulars when they are well drafted, and I am certain at least on this occasion that my hon. Friend will make sure that they are circulars which convey very clearly the feelings of this House about what local authorities should do.
It is a bridging Bill which will take us to the period when we have been told there will be fresh comprehensive legislation dealing fully with the National Health Service and embracing this aspect.
I wish to compliment the hon. Member for Derby, North (Mr. Whitehead) on all he has done to get us this far. It has not been an easy job. He has managed extremely well. I must also thank my hon. Friends the Members for Chigwell (Mr. Biggs-Davison) and Yarmouth (Mr. Fell). Certainly they have taught me a great deal about the art of improving legislation while fundamentally disagreeing with it. One respects and sympathises fully with their views.
Having read the report of the debate before Easter, I am equally grateful to my hon. Friend the Member for Glasgow, Hillhead (Mr. Galbraith) who has given a clear entry into Scottish debates to hon. Members representing English constituencies. I hope that I shall have his protection whenever I decide to intervene in a Scottish debate, even in the Scottish Grand Committee.
I hope that the House will give the Bill its full approval and send it to another place. I hope too that it will not be long before it is the law of the land.

Mr. Deputy Speaker (Miss Harvie Anderson): The Question is, That the Bill be read the Third time. As many as are of that opinion says "Aye".

Hon. Members: Aye.

Mr. Deputy Speaker: To the contrary "No".

Mr. Anthony Fell: No.

Mr. Biggs-Davison: No.

Mr. Deputy Speaker: I think the "Ayes" have it.

Mr. Biggs-Davison: No.

Mr. Deputy Speaker: The "Ayes" have it.

Mr. Biggs-Davison: No, no.

Mr. Fell: On a point of order, Mr. Deputy Speaker. I thought it was quite clear that there was a loud cry of "No" on each occasion.

Mr. Deputy Speaker: I must apologise to the hon. Gentleman. I did not hear it the second time before I collected the voices.

Mr. Biggs-Davison: Something must have gone wrong with the amplification system in the Chamber. I should have


thought that the shouts of "No" were sufficiently loud.

Mr. Deputy Speaker: They were on the first occasion. But on the second occasion I am bound to say that I did not hear the voices. However, I am prepared to put the Question again in view

Division No. 124.]
AYES
[11.35 a.m.


Abse, Leo
Garrett, W. E.
Prentice, Rt. Hn. Reg.


Albu, Austen
Golding, John
Rodgers, Sir John (Sevenoaks)


Alison, Michael (Barkston Ash)
Hamilton, William (Fife, W.)
Roper, John


Allen, Scholefield
Hattersley, Roy
Rost, Peter


Barnett, Guy (Greenwich)
Hill, James (Southampton, Test)
Sinclair, Sir George


Bennett, James (Glasgow, Bridgeton)
Hunt, John
Skinner, Dennis


Blenkinsop, Arthur
Jenkins, Rt. Hn. Roy (Stechford)
Spearing, Nigel


Bray, Ronald
Johnson, Walter (Derby, S.)
Stallard, A. W.


Buchanan-Smith, Alick (Angus, N&amp;M)
Kaufman, Gerald
Stewart-Smith, Geoffrey (Belper)


Clark, David (Colne Valley)
Knox, David
Strauss, Rt. Hn. G. R.


Cohen, Stanley
Langford-Holt, Sir John
Stuttaford, Dr. Tom


Concannon, J. D.
Lewis, Arthur (W. Ham, N.)
Summerskill, Hn. Dr. Shirley


Coombs, Derek
Lipton, Marcus
Thomson, Rt. Hn. G. (Dundee, E.)


Corfield, Rt. Hn. Frederick
Lyons, Edward (Bradford, E.)
Tugendhat, Christopher


Cormack, Patrick
MacArthur, Ian
Urwin, T. W.


Crosland, Rt. Hn. Anthony
Mackenzie, Gregor
Walker-Smith, Rt. Hn. Sir Derek


Cunningham, G. (Islington, S.W.)
McLaren, Martin
Watkins, David


Davis, Terry (Bromsgrove)
Madel, David
Wellbeloved, James


Deakins, Eric
Marquand, David
White, Roger (Gravesend)


Dean, Paul
Molloy, William
Whitehead, Phillip


de Freitas, Rt. Hn. Sir Geoffrey
Neave, Airey
Whitlock, William


Drayson, G. B.
Normanton, Tom
Winterton, Nicholas


Emery, Peter
Owen, Dr. David (Plymouth, Sutton)



English, Michael
Peel, John
TELLERS FOR THE AYES:


Farr, John
Pendry, Tom
Mr. William Hamling and


Finsberg, Geoffrey (Hampstead)
Perry, Ernest G.
Mr. Dick Leonard.


Forrester, John




NOES


Rhys Williams, Sir Brandon


TELLERS FOR THE NOES:


Mr. Anthony Fell and


Mr. John Biggs-Davison.

Question accordingly agreed to.

Bill read the Third time and passed.

Orders of the Day — SOCIAL WORK (SCOTLAND) BILL [Lords]

Not amended in the Standing Committee, considered.

Motion made, and Question, That the Bill be now read the Third time, put

of the clear indication now. Perhaps I was over-swift on the first occasion.

Question put, That the Bill be read the Third time:—

The House divided: Ayes 75, Noes 1.

forthwith pursuant to Standing Order No. 56 (Third Reading) and agreed to.

Bill accordingly read the Third time and passed, without Amendment.

Orders of the Day — TRADE DESCRIPTIONS BILL

Considered in Committee.

[Miss Harvie Anderson in the Chair]

Clause 1

INDICATION OF ORIGIN ON CERTAIN IMPORTED GOODS

11.41 a.m.

Mr. John Farr: I beg to move Amendment No. 4, in page 1, line 11, after 'Kingdom', insert:
'whether the goods have been subjected to further manufacture within the United Kingdom or not,'.
I congratulate my hon. Friend the Under-Secretary on his elevation to the Front Bench. Some of us who entered the House with him in 1959 thought that he should have been promoted to the Front Bench long ago. It gives myself and many of my hon. Friends a great deal of satisfaction to see him where he is today.
The Amendment seeks to require foreign goods in the circumstances outlined which are finished in this country to have the country of origin marked thereon. It relates particularly to the specific instance of cartridge cases which enter this country and which under the Trade Descriptions Act, 1968, were protected until the relevant marking order was revoked.
That marking order offered the consumer considerable protection against the danger of people importing foreign cases similar in colour and appearance to British cases, loading them without regard to control of ballistics and then printing them with English names and palming them off on to the public as being cartridges of wholly British origin.
It is well known that British cartridges are produced within the safety limits imposed by the British rules of proof, especially with regard to mean service pressures. Mean service pressures are the internal pressures which are exerted on the walls of a chamber of a gun when the cartridge is fired. For example, British 2½-inch chambered guns are proved for cartridges generating mean service pressures not exceeding three tons per square inch.
11.45 a.m.
To increase protection for the consumer it was hoped to make it compulsory to show on the cartons of all cartridges on sale in the United Kingdom the minimum proof level of the guns in which they should be used. At present there is the strange situation that guns are proved and marked for the mean service pressures which they are designed to withstand but there is no corresponding compulsion on cartridge manufacturers to indicate in which guns the cartridges can safely be used.
The main reasons for the Amendment are as follows. The old order which has been revoked had the effect of inhibiting the import of low quality foreign cases. Not all imported foreign cases are of low quality, but some of them—for example, those coming from countries such as Hungary and Czechoslovakia—were of very doubtful construction in some instances. It was in the interests of the consumer that such imports should be discouraged because such cases, when loaded in this country, can cause danger.
British cartridge cases are established to be of a very high standard. Most foreign cases are the same as, or very similar in appearance to, British cases, and consumers can be, and are readily, misled into buying them thinking that they are British unless the origin is given.
British cartridge manufacture is subject to continuous analytical and inspection procedures. Sportsmen accept that British cartridges are absolutely safe in use. It is known that some types of foreign cartridge have led to gun "bursts", causing injuries and damage.
Many sportsmen insist on British cases and loading because they can be sure that the proof standards accord with those of British guns. Some foreign cartridges with lower standards of proof can leave obstruction in gun barrels, with resultant danger.
Some sportsmen reload cartridge cases themselves. Unmarked foreign cases cannot be identified as safe for reloading.
The old order which has been revoked led consumers to assume that unmarked cases are British.
It is with the object of protecting users of cartridges from hidden danger that I move the Amendment.

The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): I thank my hon. Friend the Member for Harborough (Mr. Farr) for the kind words he said and the good wishes that he extended to me at the beginning of his speech. I assure him that I shall need all his good wishes.
It was useful that my hon. Friend was able to draw attention to the specific example of cartridge cases and point to the concern which exists. The Amendment seeks to extend the provision of the Bill to imported goods bearing a United Kingdom name or mark which are subject to further manufacture within the United Kingdom—in other words, in my hon. Friend's illustration, the filling of cartridge cases.
Such an extension is unnecessary and impractical by virtue of the provisions of the main Act. Section 36(1) of the Trade Descriptions Act 1968, provides that:
goods shall be deemed to have been manufactured or produced in the country in which they last underwent a treatment or process resulting in a substantial change.
 Thus, if imported goods undergo a treatment or process resulting in a substantial change in this country they are subsequently deemed to be of United Kingdom origin. The Amendment would merely secure that they were marked as being British. I do not believe that that is what my hon. Friend would wish. I therefore hope that my hon. Friend will see the problems which are involved and will appreciate that we want to ensure that there will be no danger to the public. One of the ways of doing this is to ensure that British cartridges which are entirely British made are thus marked so that the public see that what they are purchasing is of that nature.
I thank my hon. Friend for raising this point, and I hope that with that explanation he will see fit not to press the Amendment.

Mr. Farr: I am grateful to my hon. Friend for his explanation, and, although I am not entirely satisfied, I do not intend to press the Amendment. I therefore beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Eric Deakins: I beg to move Amendment No. 5, in page 1, line 11, leave out from 'the' to end of line 16 and insert
'goods are clearly, conspicuously and legibly marked with an indication of the country in which the goods were manufactured or produced, any person who supplies or offers to supply the goods in the course of a trade or business shall, subject to the provisions of this Act, be guilty of an offence. It shall be sufficient compliance with the requirements of this paragraph if the words "foreign produce", "imported produce", "product of the Commonwealth" or other indication of the geographical area in which the goods were manufactured or produced are used in place of the country of origin'.
This is in the nature of a probing Amendment and is in two parts. The first sentence which it is desired to insert makes the present wording in the Bill much clearer and, indeed, probably strengthens the intention of the promoters of the Bill. In place of the words
a conspicuous indication of the country in which the goods were manufactured or produced
the Amendment suggests that the goods should be
clearly, conspicuously and legibly marked".
This is very important in the food industry, and, in fact, this Amendment has been designed with the interests, needs and requirements of the food industry in mind. I am well aware that the origin of the Bill lies with those Members who have textile interests very much at heart, but the Bill goes much wider in its purport than merely the textile industry; and, since the food industry—if one may dare say so—is even more important and larger than the textile industry, I think it is as well that its interests are considered by the Committee. I do not think there will be any dispute about the wording of the first part of the Amendment, which I believe strengthens the Bill.
The second part of the Amendment might be a little more controversial. It provides that instead of stating the country of origin it shall be sufficient to indicate the country of origin by a generic term, in terms of a geographical area, such as, for example, "Commonwealth produce" or "foreign produce" or a similar expression which would ensure that the consumer or purchaser knew exactly that the goods were not of United Kingdom manufacture and were, indeed, imported goods.
In some cases the use of such an expression would distinguish between Commonwealth goods and other goods. This is of particular importance in the food industry where we do not have origin marking in quite the same way as may have been the case in the textile industry. I am thinking particularly of articles like fruit, which are sold under trade names, and they are on sale at stalls in the streets, in grocers' shops, and so on, under some sort of generic name.
I think, therefore, that with the interests of the food industry in mind the promoters of the Bill might see their way to accept this Amendment or at least give it favourable consideration because, as I say, we have to consider the interests not only of the textile industry but of other industries, including the food industry, to which the Bill is likely to apply.

Mr. Emery: I appreciate the way in which the hon. Member for Walthamstow, West (Mr. Deakins) has moved the Amendment, as well as his obvious desire to help in clarifying the Bill.
The problem with which I am faced is that the Amendment would make two significant alterations to the Bill. First, the indication of origin would no longer have to be in close proximity to the United Kingdom name or mark. Secondly, a variety of other forms of indication of origin would be permitted as alternatives to the actual country of origin.
I consider that the Amendment would weaken the Bill for the following reasons. The object of requiring the indication of origin to accompany the United Kingdom name and mark is to ensure that if the purchaser is misled he is only misled for as long as it takes him to read and take in the significance of the mark of origin-of the goods. The Amendment—I am sure the hon. Gentleman does not want this—would permit a clear, conspicuous and legible mark to be widely separated from the United Kingdom name or mark.
The main argument about the need for this Bill is that the United Kingdom name or mark on imported goods would be a misleading factor, and, therefore, we want to ensure that the fact of importation shall be stated in a position close to the particular United Kingdom

name or mark. The Amendment would allow the marking to be on the other side of the box. Therefore, I cannot accept that this would be an improvement.
Also, while the addition of the words "clearly" and "legibly" might be considered to be helpful, I can assure the hon. Gentleman, having taken some legal advice, that the word "conspicuous", which word appears in the Bill already, will cover both "clearly" and "legibly". Obviously, the marking would not be conspicuous unless it were clear and legible.
12 noon.
Then we come to the alternative markings. Although they would be more convenient for traders and some manufacturers, this proposal ignores the fact that the public are generally suspicious of wider terms or connotations such as "foreign" or "Empire", which terms were permitted under the old Merchandise Marks Act. Many people felt that these were cloaks under which a variety of origins could be hidden. For example, there may well be a lot of difference, in the public's mind, between a radio made, say, in Germany and one made in Hong Kong.
In such circumstances, the mark "foreign" does not give that clear indication which the consumer has a right to expect if we go forward with the Bill. Much the same applies to textiles, for example, French silk as opposed to silk from Thailand or, again, from Hong Kong. Our firm impression and information is that there is a desire that we should hold to the requirements that indicate the precise origin.
The hon. Gentleman spoke of the extra complication for manufacturers or wholesalers if precise origin has to be indicated, and I accept that that may be so. But I have myself been a manufacturer, when I was able to wear other hats, and I know that it is not an uncommon practice to have to change the labelling or marking on articles which one is manufacturing or packaging. I feel, therefore, that that argument can be somewhat inflated in this general context.
I suggest to the promoter of the Bill, my hon. Friend the Member for Leicester, South-East (Mr. Peel), that he might consider the matter, but it is my judgment that the Amendment would weaken rather than strengthen the Bill, and I am sure


that that is not a result which the hon. Member for Walthamstow, West would wish to bring about.

Mr. Tom Normanton: When I read the Amendment on the Paper today, I had considerable misgivings about the intentions underlying it. I am grateful to the hon. Member for Walthamstow, West (Mr. Deakins) for the way he introduced it, expressing his deep concern, shared by many, if not all, right hon. and hon. Members, that there should be no ambiguity which could mislead the consuming public, our object being to ensure that there is a clear indication of the source of origin of the goods available for the public's choice.
I come now to the first part of the Amendment. I am a sponsor of the Bill, not its promoter. I hope that my hon. Friend the Member for Leicester, South-East (Mr. Peel), whose Bill it is, will think it appropriate to consider the wording suggested by the hon. Member for Walthamstow, West and perhaps consider whether an Amendment might be appropriate at a later stage to achieve the object which the hon. Gentleman has in mind.
On the second part of the Amendment, I welcome the Minister's comments drawing our attention to the danger of ambiguity, which existed before November last year, in the use of the words "foreign", "imported" and "commonwealth". There is nothing to be ashamed of—indeed I hope that all countries, including Britain, will be ready and proud to do it—in marking the origin of the goods which they manufacture or export. Let it be done clearly and without equivocation.
I can see difficulty in the interpretation of the words "foreign" or "imported" within the Common Market connotation. At what stage are we in a foreign country within the Common Market? At what stage is Germany foreign to us? At what stage are goods from Italy imported?
The use of the precise name of the country of origin will remove doubt in anyone's mind as to the source of goods available to the public from which a choice may be made. I hope, therefore, that the hon. Gentleman will be willing to withdraw his Amendment, though I hope at the same time that my hon. Friend the Member for Leicester, South-East

will give detailed consideration to the first part of it.

Mr. John Peel: I am grateful to the hon. Member for Walthamstow, West (Mr. Deakins) for the way he moved the Amendment and to my hon. Friend the Member for Cheadle (Mr. Normanton) for his comments.
I very much agree with what my hon. Friend the Minister said about the first part of the Amendment. My view was that, in order to give the consumer as much protection as possible regarding the origin of goods, the words "is accompanied by" should be used, because I was assured that that would mean that the name of country of origin would have to be placed sufficiently close to the United Kingdom mark for the purchaser to be able to see it almost straight away. I regard that as important. If the indication of origin is some distance away, the consumer may well be misled, and the basic purpose of my Bill is to protect the consumer from being misled. I think it important, therefore, that we should keep the wording as it is. For that reason, I hope that the hon. Gentleman will withdraw his Amendment.
On the second part of the Amendment, I see the point which the hon. Gentleman makes, though here again I agree with what the Minister said. Circumstances regarding imported goods are very different now from what they were some years ago. It is important nowadays that the consumer should know the precise country of origin, and for this reason I regard such words as "foreign", "imported" and "Commonwealth" as insufficient.

Mr. Deakins: I am grateful to the Committee for having given the Amendment a fair run. I am grateful to the Minister in particular for having pointed out that the first part of the Amendment would to some extent weaken the Bill. I yield to no one in my desire, a desire shared, I know, by the sponsors of the Bill, to increase by every possible means the protection for the consumer and to ensure that the fullest possible information is given.
I am a little surprised to learn that the wording "is accompanied by" means in law that the mark of origin has to be


very near the United Kingdom mark. However, if that is so, I am delighted. On the face of it, it did not seem to me that it was so, but the promoter has told us that that is what he understands and, obviously, he has made inquiries and taken advice.

Mr. Emery: I had the same doubt when I had to take over the handling of the Bill in the Department, and we looked into the legal aspect of that matter. I can add my assurance to that given by my hon. Friend the Member for Leicester, South-East (Mr. Peel). What he said is correct; they must be kept together.

Mr. Deakins: I am much obliged for that clarification. I take the point also that the second part of the Amendment could in some circumstances be held to weaken consumer protection.
In view of the desire to make progress, and in view of the doubt in my mind now about the value of the Amendment, after what the promoter and the Minister have said, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Farr: I beg to move Amendment No. 3, in page 1, line 11, leave out "name or mark" and insert:
label on which the name or mark appears".

The First Deputy Chairman (Miss Harvie Anderson): I think it would be appropriate to take at the same time Amendment No. 1, in page 1, line 22, at end insert:
() For the purposes of subsection (1) of this section a name or mark which is applied to any firearm manufactured or produced outside the United Kingdom shall not be regarded as accompanied by a conspicuous indication of the country in which the firearm was manufactured or produced unless the country of origin is indicated by being incised or impressed on the exposed surface of the barrel in proximity to the breach.
and Amendment No. 2, in page 2, line 17, at end insert:
firearm" means any lethal barelled weapon of any description from which any shot, bullet or other missile can be discharged and includes a starting pistol.

Mr. Farr: I wish to put forward these Amendments because the position on firearms is unsatisfactory in the Bill. My intention is to improve the Bill for the

users of all types of firearms, including shotguns. The design, quality and performance of any firearms are all matters of great importance to the consumer or user and there is wide variety in standards of manufacture. Experience shows that the variations in these standards are directly related to the country of manufacture. Though there is a similarity in the design of shotguns manufactured in Britain, Belgium, the United States, Japan and Spain, there is a wide variation in the quality and performance of those weapons. For example, a new Purdey shotgun made in this country would cost about £2,000 whereas a shotgun of exactly the same type firing the same cartridge in the same way would cost as little as £50 if it were made in Spain. So there is a tremendous importance in establishing quite clearly the country of origin of the weapon concerned.

Mr. Alan Williams: For those of us who have a singular ignorance on the operation of certain of these sporting firearms, can the hon. Member explain the importance of distinguishing the country of origin? He mentioned a price difference, but what is the quality distinction between, say, a Spanish product and a British product?

12.15 p.m.

Mr. Farr: The Purdey shotgun—there are many British manufacturers of similar quality weapons—is hand-made by artisans who have had the craft handed down from one generation to another. The Spanish shotgun is turned out on a mass production line and exported to this country. The difference between the two is in quality and efficiency. The cheaper product is rough and ready and will go bang if the trigger is pulled but no more can be expected of it.
The same situation applies to rifles. Those manufactured in Britain, Italy, the United States of America, Finland and Germany are similar in design but there is wide variation in performance and quality. Air rifles are manufactured in Britain, Spain and many other countries and are similar in external appearance, although they too exhibit very wide variation in quality and performance. Many products produced in one country are intended copies, or nearly precise imitations, of the originals produced in another country.
I could give several examples. An interesting one is that of the Spanish manufacturer who a few years ago copied a particular type of short-barrelled shotgun which is manufactured in this country at high cost by a firm called Churchill's. The Spanish manufacturer even went so far as to introduce on his gun a special type of rib which was unique to Churchill's. Inlaid on the Spanish gun were similar insignia and the Roman numerals XXV which are also inlaid on the Churchill gun and indicate that the barrel is 25 inches long.
Most English-made firearms and some firearms made in certain foreign countries fetch higher prices than those manufactured elsewhere. The only reason for English firearms being copied abroad and sold in Britain is to obtain higher prices than the weapons would otherwise fetch. If these products do not show the country of origin it is easy for the consumer to be misled by manufacturers and importers into believing he is obtaining a firearm with a design, quality and performance associated with similar products from another country. The unsophisticated consumer is thus in great difficulty, when products look similar in appearance, in deciding which is of better value. A clear indication on a foreign weapon of the country of origin would be of particular assistance to him and to the dealer.
The question of safety is of particular importance and is one of my reasons for moving the Amendment. The barrels of firearms, shotguns and other weapons are, in the main, subjected to tests in their country of origin to establish whether they are within the safety limits laid down by legislation, where such legislation exists, in their respective countries. The British proof houses in London and Birmingham have recognised strict standards which apply to all weapons manufactured in Britain and to all imported weapons except where a mutual agreement has been reached between the proof houses concerned to exempt the products from further proving. In fact these are firearms manufactured in Belgium, France, Germany, Italy, Spain or Eire.
It is no longer the practice for foreign weapons to be marked at proof "Not English made" as used to be the case. It is, therefore, necessary for the country of origin to be known so that the necessity for British proof can be determined.

The consumer should therefore be left in no doubt as to the origin of the product he purchases, and, whilst proof marks are clearly indented giving this information, it is by no means easy for the average consumer to interpret these marks, which are garbled in appearance, and relate them to the country of origin. The marking of the country of origin, as at present required by the Order in Council, removes all doubt.
For many years purchasers of firearms in this country have been accustomed to finding evidence of the country of manufacture marked on the firearms and in the advertisements connected therewith. For the reasons I have explained, imported goods which do not contain such marking can easily be confused with British products or the products of certain other countries. Trademarks and names do not prevent misunderstanding. If the practice which has continued for so long in accordance with the requirements of the Order in Council of indicating the country of origin were suddenly to cease, consumers might well be misled into paying higher prices for lower quality products.
Two further short examples which have prompted me to move the Amendment will give an idea of the manner in which British firearms are being copied abroad and deliberately exported. There is a firm in this country of quite high repute called Holland and Holland which makes a very good shotgun, which is in great demand and very expensive. Japanese competitors have even gone to the extent of registering in Japan the name "Holland and Holland" and exporting guns to this country with that as their trademark, which bears no connection with the British firm concerned.
Secondly we must bear in mind the important point that with a shotgun, as with a firearm, we are dealing with an object that has a very long life. It is not like a garment which is discarded after a year or two or a motor car which may be changed after four or five years. Good shotguns will last well over 100 years in regular use, and I would say that most of the shotguns still in use in this country are well over 80 years old. Therefore it is no good simply to have a label attached to the weapon or a mark which can be rubbed off. The name of


the country of origin must be clearly incised on the barrel.
We are all delighted to see my hon. Friend here as Minister. If he is not fully seized of the need to make the Amendments which I have tabled, I hope that in view of what I have said and the fears I have expressed, which are widely held throughout the country, he will be kind enough to say that should they prove to be justified, and should the misleading of users of firearms of all kinds occur because of the 1968 Act, he will take steps to introduce the relevant origin marking orders to protect the consumer and the trade.

Mr. Emery: I again thank my hon. Friend the Member for Harborough (Mr. Farr) for the way in which he has spoken to the Amendment.
I think it right to deal with Amendment No. 3 first so that no hon. Member, or anyone who reads the report of the debate in Hansard, will think I tried to sidetrack the Committee from that Amendment. I am particularly worried about it because, whilst I feel that it is introduced with the intention of blocking what hon. Members believe to be a loophole in the provision of Clause 1(1), it would do exactly the opposite. It would take many classes of goods outside the provisions of the Bill, which provides that a United Kingdom name or mark applied to imported goods shall be accompanied by a conspicuous indication of the country of origin. By virtue of the Trade Descriptions Act, 1968, the name or mark is deemed to have been applied to goods if it is applied to
(i) the goods themselves, or
(ii) anything in, on or with which the goods are supplied.
That, naturally, includes the label. The Amendment would thus remove from the scope of the Bill those imported goods to which a name or marking was applied otherwise than by a label. I am certain that my hon. Friend the Member for Leicester, South-East (Mr. Peel), who has been in charge of the Bill, would object to that very much. It would remove from the Bill many classes of goods which the Committee would not be willing to see removed.
Amendments Nos. 1 and 2 specifically concern shotguns. I see serious difficul-

ties in the approach suggested by my hon. Friend the Member for Harborough in respect to firearms and to the wider implications. There is no doubt that it would give a special provision and exemption for firearms which might well be wanted by those concerned with other goods.
The essential aim of the Bill is to counter the inference of United Kingdom origin which may be drawn by anyone, but specifically the customer, where a United Kingdom name or mark is applied to imported goods. If the indication of true origin is to be this country, it is essential that the potential customer who sees the United Kingdom name or mark should at the same time see the indication of the country of origin.
I can best illustrate that by using the example given by my hon. Friend of the Japanese company which has been registered in the name of "Holland and Holland". If its guns bore the name "Holland and Holland", it is at the place where the name appeared, whether incised on the butt or wherever, that the customer should have the foreign origin made absolutely clear. The specific marking my hon. Friend wants in a set place on the barrel would exclude, in the operation of the Bill, the marking of origin being in any of the advertising literature, the box, label or any of the display notices which might be used for the sale of such equipment. I realise that many of the most expensive shotguns are not sold in that manner, but starting pistols, and so on, and some of the cheaper guns are packaged. Where there is any sign in connection with shotguns that could mislead by the use of a name or mark of British origin, it is at that point that the marking of the origin should be made.

Mr. Farr: The point is that "Holland and Holland", the name to which I referred, is not a British mark but a mark of Japanese origin. It is registered in Japan by the firm concerned. Would "Made in Japan" have to appear on such a weapon?

Mr. Emery: If the firm was selling the goods in this country the mark of origin would have to appear close to what my hon. Friend has suggested is the misleading aspect, the British name used by a foreigner to mislead. The Bill sets out to prevent that happening.

Mr. Deakins: The Minister said some thing that rather surprised me. Is it clear from subsection (1) that its intention is to apply to advertising material in connection with goods as well as the goods themselves?

Mr. Emery: Wherever there is a misleading factor, the mark of origin must be applied. It is a question of what is misleading rather than any specific field in which it is being done.

Mr. Alan Williams: The Bill refers to a mark being applied to the goods. I know that this is a rather awkward legalistic point, and the Minister, like me, is not a lawyer, but "applied to" would appear superficially to a non-lawyer to be rather specific and would not relate, for example, to television advertising of a product.

12.30 p.m.

Mr. Emery: I think I may have misled the Committee in that instance, and I am sorry. As far as I am advised at the moment, I believe that the interpretation given to it by the hon. Gentleman is correct.
I turn now to the question of the proofing of the barrels. I see this as a specific illustration, but I believe again that the fears of my hon. Friend the Member for Harborough are not correct. After all, as I am informed, all barrels and guns coming into the country have to be submitted for British proof unless there has been an exemption. There are obviously certain foreign proof houses which have been able to provide the British proofing houses with evidence that they maintain the necessary standards and reliability, and they have been able to obtain exemption from the requirements. Therefore, in that instance it is true that the barrels are not British proofed, but where there is any doubt, where no exemption has been given, these firearms have to obtain the British proofing marks.
I feel that the arguments I have put should go a considerable way to meeting the point of my hon. Friend. Of course, it is up to my hon. Friend the Member for Leicester, South-East whether to accept the Amendment or not, but it might be helpful if I give my hon. Friend the Member for Harborough the assurance he asks for. I am willing to say that

if his worst fears were realised my Department would be ready to look at the points he has made to see whether action could be taken under the existing provisions. I hasten to add, however, that I believe and hope that we will never come to that point. But if his fears were realised we would have the matter looked at again in the Department.

Mr. Alan Williams: I congratulate the Under-Secretary of State—[Interruption]. I am sorry to start with what may appear to be a corrective manner, but I hope he will listen to me now because I am about to make a complimentary remark and I know that, as a man of great humility, he would not wish to miss it. As someone who exchanged verbal assaults with the hon. Gentleman when we were in Government, I congratulate him on his first appearance on the Government Front Bench. He can feel assured that he has conducted himself in a highly acceptable way to both sides of the Committee in dealing reasonably with the points raised.
It is in this spirit that I ask the hon. Gentleman to look again at his assurance to the hon. Member for Harborough (Mr. Farr). If the basic point made by the hon. Member for Harborough is valid but there is a quality difference as well as a price and place of origin difference, action should be taken, because this is a matter of consumer interest, a point admitted by the Under-Secretary of State's predecessor as a critical deciding factor. If there is a quality difference, this should easily be able to be established without having to wait for a certain situation to arise. The hon. Gentleman said that the Department would consider the matter if a certain situation arose. But on the basis that prevention is better than cure, and since scientific data are readily available here, I think the hon. Gentleman should go further than he has done with his assurance.
It may be that no Amendment is needed to the Bill. I would have thought that this aspect was already covered in the 1968 Act. In the interests of the consumer, I think that the hon. Gentleman could take powers under that Act. I ask the hon. Gentleman to strengthen his assurance to the extent of saying that he will make the necessary inquiries before a certain situation comes about.


If there is a quality difference and a safety element is involved, a regrettable situation might come about, and it is one which I am sure the hon. Gentleman would wish to avoid.

Mr. Emery: I thank the hon. Member for Swansea, West (Mr. Alan Williams) for his kind remarks. I hope that we can always keep our level of debate as it is today. I have my doubts, but I thank the hon. Gentleman for his good wishes.
I hoped that by referring specifically to the proofing factor I was dealing with the aspect of safety. I accept that if I were in any way concerned about the safety aspect I would want to see action at this stage, but I do not believe that it is involved here, and I believe that the hon. Gentleman is right in saying that there are powers under the 1968 Act to deal with the trade description position.
I always believe in making certain that one does not leave any ambiguity, and I want to clear up the advertising position. The Bill applies not to advertising in general, which might have been inferred, but to advertising "in, on or with" any goods to which the United Kingdom name or mark has been applied. In other words, it would apply to the show cards nearby. This is important. In other words, it applies not to general advertising but to show cards or packaging.

Mr. Normanton: I am grateful to my hon. Friend the Under-Secretary of State for that last observation. Within the context of the wish to see the public protected from abuse, this is an extremely important point because there are far too many cases where the public are deceived by glamorous wilful deception in techniques adopted in offering goods for sale. Whatever goods are imported, they must have the country of origin clearly stamped on them.
Should any goods be offered for sale to the public—we can be assured on this in the drafting of the Bill—any attempt to camouflage or mislead the public about the true source of origin will lay those responsible open to the full consequences of the Bill. That cannot be too strongly represented. I am grateful to my hon. Friend the Under-Secretary of State for having done so.

Mr. Farr: In view of the assurance of my hon. Friend the Under-Secretary of State, and in the certain knowledge that should the dangers arise that I have described he will take vigorous action, I beg to take leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Deakins: I beg to move Amendment No. 6, in page 1, line 18, leave out from 'mixtures' to end of line 19 and insert:
For the purpose of this subsection the expression 'blend' or 'mixture' does not include any blend or mixture which has been subjected to a process of manufacture resulting in a substantial change.
For the purpose of clarification, I make it clear that the Amendment would mean that the existing subsection would be divided into two. There would be two separate sentences.
On Second Reading the hon. Member for Leicester, South-East (Mr. Peel) said:
Clause 1(2) of the Bill may be somewhat confusing. It excludes from the provisions blends and mixtures of materials of the same kind. Such blends and mixtures are often made of materials from different sources, and they were excluded from the scope of the 1926 Act provisions.
There was then an intervention by the hon. Member for Bosworth (Mr. Adam Butler), to which the hon. Gentleman replied:
This can be considered in Committee if an Amendment is proposed. Some difficulties might be involved here and that is why I mentioned it."—[Official Report, 25th February, 1972; Vol. 831, c. 1675–6.]
It would be generally accepted that the wording of subsection (2) is rather obscure. I find difficulty in understanding exactly what is intended about blends and mixtures by the sponsors. It is rather vague. My concern is about its effects not on the textile industry, where there may well be special problems, but on the food industry. I am concerned about the effect the subsection is likely to have on food mixing and blending. For example, a commodity like vinegar might be blended in this country from a whole variety of imported ingredients. I cannot believe it is the intention of the sponsors that on the vinegar bottle it should be stated that ingredient A comes from country 1 and ingredient B from country 2, and so on.
Although it might be logical I do not believe it would be helpful to the consumer who wants to know who made up the vinegar. The important point is that the blending and mixing should have taken place in this country rather than overseas. There are other examples, but I hope that I have made the point that there would be grave difficulty in applying this subsection to certain processes in food manufacturing. The purpose of the Amendment is to clarify what I hope is in the minds of the sponsors so that the expression "blend" or "mixture" will exclude any such blend or mixture which has been subject to a manufacturing process resulting in a substantial change so that we are dealing with a completely different commodity from the ingredients which went into it in the first place.
I hope that the sponsors will look kindly on this or a similar Amendment. Otherwise the subsection is likely to create considerable difficulty and confusion. This can lead to weakness in application and misunderstanding, with a lot of time being wasted. It is right that in Committee we should do our best to clarify a somewhat obscure subsection.

Mr. David Clark: May I raise a point relating to the wool and cotton industries? It was pointed out on Second Reading by the hon. Member for Leicester, South-East (Mr. Peel) that mixtures of materials of the same kind are not covered by the Bill. The Minister's predecessor made the same point when he said that
a blend of two wool fibres of differing origins would in theory fall within the exception…"—[Official Report, 25th February, 1972; Vol. 831, c. 1736.]
Can the Minister deal with this? If we import wool from New Zealand and Australia in a raw state and mix it, does it mean that it would not be covered by the Bill? The same thing applies to the cotton industry.

12.45 p.m.

Mr. Emery: May I now do some congratulating? This is the first time I have seen the hon. Member for Colne Valley (Mr. David Clark) on the Opposition Front Bench. Although I am certain that he has been there before, it is the first time I have had the pleasure of dealing with him in this way and I would like to extend to him my good

wishes. I can understand why he has raised the point he did, bearing in mind his constituency. I admit readily that Clause 1(2) is unsatisfactory and I have been giving a good deal of thought to what should be done about it—much more thought in the first four days of taking office than I would have wished.
Much as I would like to be able to accept the Amendment I do not believe that it is what is required. The original thought behind the subsection was to exempt those cases in which, if a United Kingdom name or mark was applied to a blend or mixture, the indication of origin required by Clause 1(1) would involve naming more than one country. In some circumstances that could obviously create practical difficulties, as the hon. Member for Walthamstow, West(Mr. Deakins) has made clear. That position could arise only if the material blended or mixed came from two or more different countries.
Section 36(1) of the Trade Descriptions Act, 1968, provides that goods shall be deemed to have been manufactured or produced in the country in which they last underwent a treatment or process resulting in a substantial change. If the process of blending or mixing results in a substantial change, the exemption should not apply. This might result from a chemical reaction between materials as, for example, when water is mixed with cement. The exemption should not apply either if, after blending or mixing, the combined materials were subject to some process which produced a substantial change as, for example, by applying heat to a mixture of thermostatic plastic powders, thereby converting them into a solid mass.
Nor should the exemption apply if, while or after being blended or mixed, the materials were incorporated into something of a quite different identity. Here we come to the example given by the hon. Member for Colne Valley—a mixture of cotton fibres spun into different threads or warps and wefts of different origins woven together to form a piece of cloth. We are talking about a wide variety of cases not easily covered by the simple form of words we have here.
I have thought long and hard about this but have to admit that at the moment I have not devised an alternative form of words which would cover the situation


even as well as the Amendment. However the Amendment does not cover the whole matter or deal with all possible combinations or circumstances or those cases in which the practical problems of stating the country of origin of blends or mixtures is serious enough to justify exemption from the Bill. What I recommend to the Committee and to my hon. Friend the Member for Leicester, South-East (Mr. Peel) is that we must give further consideration to Clause 1(2). This may even mean taking it out of the Bill entirely and leaving the difficult cases to be dealt with as they emerge under Clause 1(4). This is the suggestion which I shall be putting to the noble Lord who will deal with the Bill in another place.
Therefore I would hope that although I am not able to accept the Amendment moved by the hon. Member he will, through this explanation which I have offered, be fired with the knowledge that his initiative and his Amendment have made us think very deeply about the matter and that his Amendment has been extremely helpful. I hope he will understand the difficulties in which the Government find themselves on this matter; we shall have to look again at this during the further progress of the Bill in another place. I hope this will be acceptable to my hon. Friend the Member for Leicester, South-East because, of course, he will be entirely concerned with the Bill during the whole of its life. I think I can say, after conversation with him, that he appreciates as much as I do the problems on this matter.

Mr. Peel: I simply want to thank the hon. Member for Walthamstow, West (Mr. Deakins) for raising this issue and to thank also his hon. Friends on the Opposition Front Bench. On Second Reading of my Bill I detected the problems which were raised by this subsection and I am very glad that the hon. Gentleman has brought the matter up.
I am grateful to my hon. Friend the Minister for the consideration he has very kindly given to the matter, especially when he has had to do so at short notice. The proposal which he has put forward I gladly accept, because I think it is probably the best answer. In these circumstances I very much hope that the hon. Member for Walthamstow, West will be prepared to withdraw his Amendment.

Mr. Deakins: I am grateful that the Committee has accepted the spirit and purpose of the Amendment. I think it is generally agreed in the Committee that if subsection (2) were to be left as it is, it would cause a great deal of confusion and would not necessarily help the purposes of the Bill. Whether it could be dealt with by the sort of clarifying Amendment the Minister has been racking his brains about for the past four days, or by withdrawing the subsection altogether, I do not know, but I think the Committee is of the general opinion that we cannot leave subsection (2) as it is. Since that seems to be the general feeling of the Committee, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Deakins: I beg to move Amendment No. 7, in page 1, line 22, at end insert:
(4) Subsectiton (1) of this section does not apply to the sale of any foodstuffs at any hotel or restaurant or other premises for consumption thereon or the sale of any foodstuffs, which have undergone a process of cooking, curing or preserving in the United Kingdom.
This is a new subsection which raises two entirely separate points. Although it is in one sentence there are two quite separate halves so to speak.
The first part is about sales of foods at restaurants and hotels—in a word meals, to make the matter as clear as possible. As I understand the situation, if the Bill were to go through without such an Amendment as this, once the Bill had become law a restaurant owner, a cafe owner or a hotel proprietor—anyone providing meals to the public—would be under an obligation to ensure that the origins of the foodstuffs used in a meal were described to the consumer, and that would be done through the bill of fare or menu. To give a simple example, if the order were for "beef and two veg" the menu would have to say whether the beef came from the Argentine or—

Mr. Farr: Leicestershire.

Mr. Deakins: —or Leicestershire; whether it was English, Scottish or American, and so on. As agricultural experts in particular know, there are many varieties of beef. Similarly with lamb. It would have to be said whether it was English, Welsh, Scottish or New Zealand,


and to those varieties we shall have to add one or two more if we go into the Common Market. It is a question of the main constituent of the dish. To take again the example of the order for beef and two veg, it would be necessary to write on the menu where the potatoes came from if they were not English, whether they were Dutch or Danish or whatever the case might be. If the dish were to be of eggs it would have to be stated whether they were Finnish, Polish, Argentinian, New Zealand or whatever else they were.
This would create considerable difficulties for the catering industry generally, because there would have to be constant changes in the descriptions set out on menus in restaurants, hotels, cafeterias, and so on. It is well known that caterers buy their foods from the most convenient markets, and the most convenient market may not always be the same one and the foodstuffs bought do not necessarily always come from the same country of origin. A caterer may serve Argentine beef on one day and on another day United Kingdom beef. Similarly with all the other items which go on menus. To have to make these constant changes would certainly mean a great deal of inconvenience and expense to the caterer.
I do not regard that as necessarily an overwhelmingly important issue. It would be a relatively unimportant issue if the interests of the consumer were to be served by what is proposed in the Bill. I wonder, therefore, what is the intention of the sponsors of the Bill.
For example, a customer asks for beef and two veg, and he gets beef and two veg and is perfectly satisfied with them, but he does not necessarily know that the beef came from the Argentine or that the potatoes came from Holland; and if he orders an omlette he does not know whether the eggs came from Finland, if they did not come from the United Kingdom.
My first point, therefore, is whether there is any great consumer protection in insisting that the provisions of the Bill should apply to meals in restaurants.
The second part of my Amendment is a slightly different one relating to the sale of
foodstuffs, which have undergone a process of cooking, curing or preserving in the United Kingdom".

It is rather similar to the point I made earlier about blending and mixing. To give an example shortly, it is the practice of some firms in the meat industry, in which I used to work before I became a Member of the House, to import pork from, let us say, Holland or Denmark and to apply to that pork a process of pickling or sometimes of curing to produce hams for sale to the public in this country. Those hams are rather like British hams in that they are produced in this country, but they are produced from imported material, even though it has been subjected to a substantial manufacturing process. I wonder whether the sponsors of the Bill can say whether it is the intention in the case of ham that it would have to be labelled "Product of Holland"—or Denmark or whatever country the pork came from—rather than let it be assumed to be a product of the United Kingdom since it would be a product of manufacture or process by a United Kingdom firm.
Another example is preserves, the manufacture of jams for instance. No doubt jam manufacturers in this country from time to time use imported ingredients. The question is whether the interests of the consumer are likely to be safeguarded by ensuring that on a bottle of jam sold to the consumer it is absolutely necessary to say that the currants, strawberries or other ingredients came from Barbados and that the sugar came from another part of the West Indies, and all the materials not specifically mentioned must be deemed to have been produced in the United Kingdom. Is the consumer interest helped in that respect? Most consumers would regard jam manufactured in this country, albeit from imported ingredients, as being of United Kingdom origin. Is this the intention of the sponsors?
1.0 p.m.
Alternatively where a raw material has undergone substantial manufacturing processes, either in cooking or pickling, could it not be misleading to the consumer to describe such a product as "Made in Holland" or "Made in the West Indies"? Patently the product would not have been made there in the sense that the consumer would normally understand that expression. I appreciate that there is a difficulty here, as we had with mixing and blending, and we must seek a compromise. The wording of the Amendment


is not necessarily ideal but I hope that the sponsors will agree to look at this again, if necessary in another place.

Mr. Normanton: With great respect to him, I think that the hon. Member for Walthamstow, West (Mr. Deakins) has misunderstood what is in our minds. The Bill does not require the country of origin to be indicated on goods unless those goods are deemed, through labelling or description, to come within the terms of the Bill and therefore to be likely to mislead. Imported goods which have no label or description attached to them would not require to have their country of origin attached to them whether they are for sale and consumption inside premises or for sale over the counter.
On the other hand, if a dish described as Aylesbury duckling or Cheshire cheese did not come from Aylesbury or Cheshire this would technically be a case of misrepresentation to the consuming public. The requirement to indicate the country of origin of goods to be consumed at a catering establishment or sold over the counter could arise only if those goods were labelled misleadingly.

Mr. Emery: The Amendment seeks to exclude from the provisions of Clause 1(1) foodstuffs sold in hotels, restaurants and the like which have been cooked, cured or preserved in the United Kingdom. The hon. Member for Walthamstow, West (Mr. Deakins) made his first point most reasonably, and that point was reinforced by my hon. Friend the Member for Cheadle (Mr. Normanton).
Section 36(1) of the principal Act provides that goods shall be deemed to have been manufactured or produced in the country in which they last underwent a treatment or process resulting in substantial change. I am advised that this applies where catering establishments cook food which they serve for consumption on the premises, and equally where anyone else in the United Kingdom cooks, curesor preserves imported foods. Those foods are no longer goods manufactured or produced outside the United Kingdom and are, therefore, exempt from Clause 1(1) without the need for an Amendment. I hope that assurance will help the hon. Member for Walthamstow, West.

Mr. Normanton: I am not clear on the point made by my hon. Friend the

Minister. Does he regard this as the correct interpretation of the Bill: that where goods offered for sale at a retail establishment or food store are described as having been cooked or processed in this country and have attached to them a geographical name such as Aylesbury or Cheshire the requirement is that that description shall be an honest description, and if it were not an honest and true description there would be an offence?

Mr. Emery: My view on this is that we are going somewhat wider than the Bill. A Yorkshire pudding does not have to be made in Yorkshire, nor, indeed, is all Cheddar cheese made in Cheddar, and I do not believe that any Stilton is made in Stilton.
I do not see why imported foods which are served for consumption in their original containers should not receive the same treatment as they receive when they are sold across the counter. One is buying an article with a United Kingdom name or mark. An imported carton of yoghurt in its original container would have its mark of origin irrespective of whether it was sold over the counter or for consumption.
My advice is that there is no need for the Amendment because the problems which have been raised are already covered.

Mr. Deakins: I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Motion made, and Question proposed, That the Clause stand part of the Bill.

The Chairman: Although I have not selected it, I am prepared to allow on this Question a discussion of new Clause 1:
Misleading absence of marks of origin

(1) Any person who supplies or offers to supply in the course of any trade or business any goods to which this section applies on which the country of manufacture or production is not conspicuously indicated shall be guilty of an offence.
(2) This section applies to any goods in respect of which the Secretary of State has made an order under this section:

Provided that such orders shall only be made in respect of goods where the absence of a conspicuous indication of the country in which the goods were manufactured or produced is liable, in the opinion of the Secretary of State,


to mislead purchasers of those goods as to their country of origin.

(3) An order under this section shall be made in the form of a statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Mr. David Clark: I thank the Minister for the kind words which he addressed to me a few moments ago, and I reciprocate his good wishes.
In discussing new Clause 1 on the Question "That the Clause stand part of the Bill", I should like to outline some of the difficulties which have become apparent. Generally, we support the Bill, and our only reservations are that we feel it does not go far enough in making provision for sufficient information to be given to protect the consumer. On the one hand, we are trying to provide all the information that the consumer might need, yet on the other hand we are conscious that we must honour our international obligations.
In that spirit we put forward new Clause 1, which seeks to help the Government, the consumers and also various industries which feel themselves to be affected by the Bill following the disappearance of origin markings last November. We welcome the spirit in which the Government have approached the Bill and also the co-operation shown by the sponsors.
The Under-Secretary of State said that in the last four days he had spent a large amount of time examining the Bill and that he would look again at Clause 1(2). He also said that his Department's help would be available to the sponsors in another place.
The Bill relates to a somewhat narrow point which has been difficult to deal with. Perhaps the easiest way to tackle the problem might be by amending Section 8 of the Trade Descriptions Act, 1968. We all appreciate the background to this Bill following the situation which arose last year, after many years of various merchandise Acts running back to 1887, when origin markings disappeared. There was then some disagreement over the matter. The Labour Minister who was responsible for piloting through Parliament the Trade Descriptions Act, 1968, said in Committee on that legislation that in regard to Section 8 of that Act the interests of consumers would be

wide enough to include manufacturers as consumers of raw materials. It was felt that the powers in Section 8 were not strong enough, although certain powers were taken in regard to certain foodstuffs.
We disagree to some extent with the Government's interpretation, and in the new Clause we intended to give the Minister a power in respect of origin markings which we thought he would like to possess I accept that the new Clause is a little cumbersome, but the point which we sought to cover was that in the absence of origin marking, which might be taken to mislead the consumer, the Minister would have the right to issue an origin marking order subject to a Statutory Instrument. We thought that this was the best way to protect everybody's interests in this complex matter.
It has been a tradition in the cotton and wool industries that goods which are unmarked are known to be British and that all imported goods by being marked are known to be foreign. Tradition dies hard, and it could be argued that the absence of origin marking will be taken by many people as denoting that those goods are made in Britain. This situation could have been avoided if the new Clause had been accepted by the Government since it enables the Minister to insist on origin marking. We must remember that we must protect the consumer, and, therefore, this is a most important provision.
1.15 p.m.
I was impressed by an article in the Sunday Times on 2nd April which published the results of a survey by the Opinion Research Centre on the subject of consumers' needs. I was interested to see that no fewer than 94 per cent. of those interviewed said that they wished to know the country of origin. I believe that is an accurate reflection of public opinion and is quite true. The article in the Sunday Times said that such a high percentage was rather rare in polling, and went on to say:
An O.R.C. man said last week: 'We normally get that kind of response only to questions like Do you commit adultery?' Apparently the vast majority deny it.
This shows that the man or woman in the street cares about where goods are manufactured, and we believe this is right and proper. If people want to buy foreign


goods it is a decision for them to make, but they should have a right to know where the goods were manufactured.
Since I represent the constituency of Colne Valley which has a wool and clothing industry, I was impressed to see that no fewer than 86 per cent. of those interviewed thought that they got the best value from British clothing. That is a fair commendation to all those concerned with the clothing and textile industries.
The whole question of advertising raises serious problems in this sphere, and I hope that the Minister will see what he can do to resolve them. As I understand the situation, even a showcard could be taken as an intention to mislead the purchaser in respect of goods, but an advertisement in a mail order catalogue would not be covered by the Bill. I can envisage a bizarre situation in these days of colour advertisements in newspapers when the Union Jack, the Cross of St. Andrew or the pennant of the lion rampant, a familiar sight in Scotland, will be used as background to an advertisement by a firm seeking to sell Japanese whisky. These are problems with which we shall have to cope in seeking to provide further information to the consumer.
The wool industry is seeking origin marking not through any form of protectionism but because it believes it is right that people should know where goods come from, because it must be remembered that when goods are made in Britain there is usually a guarantee of high quality. I am not saying that other countries do not produce high quality wool textiles. Obviously they do. But people have to decide which is high quality and which is not. While it is often difficult to tell from the texture of a cloth how good the quality is, a marking showing the country of origin sometimes gives an indication of the quality.

Mr. William Molloy: I am extremely interested in this point as it affects finished articles. I am sure that the Association of Clothing Contractors will agree that it should be made clear when goods are made in this country, not because it is against goods made by other countries as such but because the standard of workmanship in a made-up suit or coat made in this country by British

craftsmen is second to none. There are some extremely clever methods by which it is sometimes suggested that a garment which has been made in a foreign country has been made in this country. Very often the standard of workmanship is poor in foreign garments. We are trying to point this out not because a garment is foreign-made but because it is of a poorer standard.

Mr. Clark: My hon. Friend has made the point clearly, and, obviously, I agree with him. We are not interested in protectionism. We are interested in giving information about goods. We feel that there should be fair competition, and this is a rather difficult situation. In the Second Reading debate on 25th February the Minister's predecessor made the point, for example, that there are not very many important countries which insist on origin markings. He said that the United States was about the only one. He went on to discuss the E.E.C. countries. Obviously, no one can ignore the effect of the E.E.C. in this respect. I was a little perturbed when he discussed the German situation. Although I see the point that he was making, he gave the impression that without origin markings British industry could still compete favourably and fairly with the E.E.C. countries. I am a little perturbed when I see the situation in Germany. As I understand it, the position there is that where any label on goods is in German the origin of the country in which they were produced must be stated. That puts us at a disadvantage. There is probably a case for saying that wherever a label is in English there should be some way of determining the country of origin. Clearly, the Germans feel that if the label is in German it is misleading to the consumer, who might innocently asume that the fact that the language is German means that the product is German. We feel that the competition is not exactly and completely fair.
In our argument on this Clause we are trying to help everyone concerned. We are trying to protect the jobs of many thousands of highly skilled personnel by ensuring that there is fair competition. We are trying to look after the interests of the consumer. I have heard it argued that we cannot insist on origin markings because the cost of doing so is prohibitive. However, I understand that we


are to have an E.E.C. directive before long which insists that all textile garments bear some indication of the fibre composition. If we are to give the consumer information about the composition of the goods, I believe that we should go a stage further and indicate their origin.
I hope that the sponsors of the Bill will continue to be as co-operative as they have been in the past. We all hope that the Bill will go to another place and that the Government will assist its sponsors in the other place. However, perhaps the Minister will also consider the approach that we have made to the Bill and see whether at a later stage he can help the sponsors in getting a provision on the lines of this proposal inserted in the Bill. We believe that it would make this legislation very much fairer to everyone concerned.

Mr. Farr: Although I tried, without success, to improve Clause 1—and I am grateful for what my hon. Friend the Under-Secretary has said—there is one point which I should be grateful if he could clarify. Does the Clause relate to the sale of second-hand goods? I assume that it does. I am concerned especially about second-hand goods which have a very long life. I should like to be assured that the protection afforded to the purchasers of new goods applies equally to the purchasers of second-hand goods.

Mr. Molloy: I, too, offer my congratulations to the Under-Secretary. We have agreed about many matters and crossed swords about many others, not only in this House but in establishments overseas. I hope he will have a happy stay in his new office, though I trust that it will be a short one.
The sponsor of the Bill is to be congratulated. I support the ideals and objects behind his Measure. However there are some aspects of the Trade Descriptions Act, 1968, which, if they had been enforced with more vigour, would have done a great deal more to strengthen our legislation on these matters.
No one in this House or in the country is against foreign goods as such. What perturbs ordinary people is that some foreign goods are coming in which are substandard. Some very clever devices are used to imply that they are of a higher standard and that they may be of British

origin. It is that form of deception that I hope that the Bill will contribute to removing. We are trying to prevent the public from being the victims of a number of private cheats. Whether we like it or not, it must not be suggested that we have in mind merely wicked foreigners who send their substandard goods to this country, because they are aided and abetted by their British counterparts who are their allies in this form of deception.
There are still many people who are very properly influenced by the simple statement on goods that they are British made. This applies very much overseas. People have a sense of confidence when they see goods or articles marked as being British made. Britain has nothing to fear.
1.30 p.m.
I am not sure whether the Bill applies to spareparts supplied, for example, for radios and motor cars. Japanese radios have been referred to. I remind the Committee that a first-class British Parker pen was cleverly mimicked in appearance by a much cheaper and inferior Japanese substitute. Complaints have been made to me by people who thought they were buying a new spare part for a wireless, a television set or a fountain pen but who discovered that, far from their purchasing a genuine British spare part, they were being fobbed off with a foreign substitute of much lower quality although at the same price.
It has been said this morning that we might be moving to a situation in which, if—as I think, regrettably—we join the Common Market, there will be no need to mark goods coming from Community countries. The implication seemed to be that, although the 1968 Act and the Bill will apply to many other foreign goods, they will not apply to goods emanating from Community countries if and when we join the Community.

Mr. Normanton: I may have raised ambiguities in the minds of the hon. Gentlemen and other hon. Members and also in the minds of people outside the House. My point was in connection with an earlier Amendment which suggested that the country of origin could be covered adequately by having the word "Foreign", "Commonwealth", or "Imported". I speculated about the possible inappropriateness of such phraseology within the context of our joining the Common Market. I did not


say that it would be inappropriate. I gave voice to the fear in my mind, a fear which is, I believe, in the minds of many others, that in an entirely new environment in terms of tariffs and economic controls there will be a loophole. That is the last thing that I, as one of the sponsors of the Bill, would like to see. I am delighted that the hon. Gentleman wishes to ensure that it does not arise.

Mr. Molloy: I share the hon. Gentleman's apprehensions. I therefore hope that we shall both receive reassurance from the Under-Secretary.
I hope also that the Under-Secretary will be able to comment on the aspect of advertising. There is a grave danger of people being misled. The organisation which represents the manufacturers of women's clothes—the light centre and the heavy centre of the clothing industry; costumes, coats, underwear—is the Association of Clothing Contractors. There has been a tendency in advertisements recently to give the impression to the unsuspecting prospective consumer that a lady's coat or costume, say, is of British make-up origin. This arises from a clever and devious use of advertisements—for example, the use of some well-known national symbols.
This is a dishonest ploy which we should try to outlaw in the interests not only of all members of the association but also of all members represented by the National Union of Tailors and Garment Workers, which feels annoyed when the craftsmanship of its members is stolen or appropriated to foreign goods—not because the goods are foreign, but because they are substandard.
British and Commonwealth manufacturers are only too proud to state clearly for the world to see that the goods are British- or Commonwealth-made, because such manufacturers have confidence in the quality and in the competitive price of their products.
I hope that the Minister will seriously and sympathetically consider the points outlined in the new Clause. The Clause would strengthen the Bill and assist the objects of the sponsors of the Bill. There is, regrettably, a minority in trade and commerce which stains the good name of private enterprise by trying to cheat. These people are skilful. It is worth their while knowing all about the law

and its loopholes. The object of the exercise is to cheat the people. By cheating the people they cheat not only the purchaser, but also the British and Commonwealth producers of the goods. The hon. Member for Harborough (Mr. Farr) gave the example of shotguns. There are many other examples right across the board.
I hope that the House will support the Bill and that cognisance will be taken of what my hon. Friend the Member for Colne Valley (Mr. David Clark) said about new Clause No. 1.

Mr. Arthur Davidson: I add my congratulations to those which have already been expressed to the Under-Secretary on his appointment. I know him very well, and although that fact is not necessarily in his favour, I am none the less delighted to see him occupying that position.
I do not think I need make a meal of what I am about to say—whether of Aylesbury duck or otherwise—because the points have been more than adequately covered. I take a very simple view about the Bill. I believe that at all times the maximum amount of information should be given to the public This applies not only in respect of consumer protection, but I also feel very strongly about the absence of information from official quarters, which is why—and I am now going very much out of order—I have always opposed the Official Secrets Act. However, Sir Robert, I doubt whether you would allow me to speak in detail about the Official Secrets Act on this Clause.
I feel that the British public are entitled to receive the maximum information. They want to know what they are buying, not only as regards quality but also about where the goods come from. Therefore, while I welcome the Bill I have reservations because I do not believe it goes far enough.
I should like the Under-Secretary, particularly after the nice things that I have heard said about him, seriously to consider new Clause No. 1.

Mr. Emery: Flattery will get the hon. Member nowhere!

Mr. Davidson: This would enable him to make orders where the absence of any mark could be misleading to the public.


This applies particularly in places like Lancashire where people believe that when there are no markings on goods, the goods come from Britain, and probably from Lancashire. At a time when the Lancashire textile industry needs help, even if it does not need protecting, any measure, however small, to assist in this way would be very useful.
While talking about the Lancashire industry, I must not forget the Cheshire textile industry, because the hon. Members for Cheadle (Mr. Normanton) and for Macclesfield (Mr. Winterton) have both pointed out how important that industry is.
I have always thought that the Trade Descriptions Act would cover the points which have been raised but that, if it did not do so, the simplest way of dealing with the situation would be to amend that Act. I have never had a satisfactory explanation from any Minister why that simple device has not been adopted. However, since apparently the legal advice is that it cannot be done, new Clause 1 seems to me to be the next best thing and the next best method of ensuring that as far as possible people who buy goods—and I am particularly concerned about cotton textiles—have more information about the origin of the goods so that they do not purchase them in the mistaken belief, through the absence of markings, that they are buying British goods when, in fact, they are not British.

1.45 p.m.

Mr. Farr: I welcome this Clause but I wonder whether the Clause and the Bill as a whole go far enough in protecting the consumer. I am one of those who regretted the action of the previous Government in passing the Trade Descriptions Act, 1968, which has necessitated the introduction of the Bill. The fact is that although my hon. Friend the Member for Leicester, South-East (Mr. Peel) introduced the Bill which hon. Members on both sides of the House wish to see put on the Statute Book, it does not by any means fully restore to the shopper the protection which he enjoyed before the 1968 Act was passed.
The housewife will have to be very careful of the purchases she makes in the future, particularly unmarked goods such as woollens and stockings which

she has been accustomed in the past to assume were British if no country of origin was marked on them. Even when the Bill goes through, as I am sure it will, a new position will have arisen with regard to foreign goods. They will be able to enter the country and be sold with no indication of the country of manufacture on them. This may be a good thing; I am not saying it is not, although personally I doubt it, and I believe that many discerning consumers, not necessarily for patriotic reasons, place great value on the simple label "Made in Britain". Because it is essential to help the housewife to know what she is buying, I think that all foreign goods which enter this country should have the country of origin marked on them.
Consider what will happen, for instance, in a few months' time when a shopper goes to one of our multiple stores, such as Marks and Spencer, to buy her household requirements for a few days or a week. She may start at the counter where various garments are sold and may perhaps buy a pair of stockings, a pair of trousers or some woollen goods. She has to remember that at all counters where garments and woollens are unmarked they are likely to be of foreign origin and manufacture. Then she will move on to the next counter to buy some food. She may want some tinned food, a joint or some jam. She has to remember that those goods without the country of origin marked on them will be British.
When she has bought her food she may move on to another counter to buy some toilet requirements, and she will have to bear in mind that unmarked soaps and toilet goods offered for sale are likely to be foreign goods. Finally, when she buys some pet food and a packet of seeds for the garden, the unmarked goods will be British.
I fear that the Bill will lead to chaos. The housewife will be severely misled, not necessarily deliberately but simply because it will be very difficult for her to remember these different points that I have mentioned.
The Bill will help to a limited extent; it will restore some of the protection which the housewife should enjoy, and for that reason I welcome it. I congratulate my hon. Friend the Member for Leicester, South-East on his initiative in


introducing the Bill, but I still fear that it does not go far enough to protect the consumer. I should like the country of origin to be marked on all imported goods so that the housewife could be sure of making a choice without fear of deception.

Mr. John Forrester: A few minutes ago the Minister told my hon. Friend the Member for Accrington (Mr. Arthur Davidson) that flattery would get him nowhere. I suppose that abuse will get me nowhere either, so I shall content myself with wishing the Minister well on his new appointment.
On Second Reading, and again today, many doubts have been expressed about the effectiveness of the Bill. My hon. Friends the Members for Accrington and for Colne Valley (Mr. David Clark) suggested that the same protection for the consumer could have been achieved under Section 8 of the Trade Descriptions Act. I shall not pursue that point now, but there is an idea growing in the country, and in the trade associations concerned, that the Bill does not go far enough to protect the consumer's interest. However, many who feel that concern are none the less extremely grateful to the hon. Member for Leicester, South-East (Mr. Peel) for giving the House an opportunity to debate these matters and to put some legislation on the Statute Book.
There is a fear that the Government themselves, though willing to accept the Bill in its present form, are not necessarily prepared to strengthen it. I hope that is not so. I was gratified to hear the Minister say that he had spent many sleepless hours thinking about Clause 1(2) since he came to office earlier this week.
I make a special plea for consideration of new Clause 1. That Clause, or similar words inserted in the Bill, would put far more teeth into it than it has at the moment. Like the hon. Member for Harborough (Mr. Farr), I should much prefer to see all goods marked with the country of origin, because in that way the shopper would be far better protected than he or she is now.
Some goods and trades axe particularly vulnerable. I think of Sheffield cutlery, or pottery, in which I have a special interest, and of textiles—though I shall not

involve myself in an argument about where textiles are manufactured. Each of those industries in this country can match its overseas competitors in quality, but each has at some time or other been the target of unfair foreign competition, and may well be subject to pressure from overseas again.
It is sometimes easy to deceive the unsuspecting buyer, and this is especially so in pottery. There are traditional patterns and shapes, and English country scenes or pictures of our historic buildings are printed on pottery. All these ways have been used in the past, and, no doubt, will be used in the future, to mislead the consumer. One recalls the protective coverings adorned with many Union Jacks which, when removed, revealed sanitary ware made not in England but in China. This is the sort of thing we are all up against.
I accept the argument put by the previous Minister that origin and quality are not synonymous. However, if a manufacturer has to disclose his identity, he is more likely to produce goods of quality, especially if he wants repeat orders, than one who hides his identity or is not required to disclose where he comes from. I wonder how the consumer can be protected against making a bad buy in future if there is no indication on goods of who made them or of their country of origin.
If people wish to buy the products of a certain country, be they British made or foreign made, they have a perfect right to do so, and the more information we can give to consumers the better shall we fulfil our obligations to them.

Mr. Arthur Davidson: I am interested to hear what my hon. Friend says on that point. There are people who, for a variety of reasons, sometimes snobbishness perhaps, though by no means necessarily so, like to buy foreign goods, who like to have "Made in Sweden" on their pottery or whatever it may be. Does not my hon. Friend agree that it is in the interest of those people just as much as of the consumer who wants to buy British that markings should be on those goods as well?

Mr. Forrester: Yes. Perhaps I put the point badly. People who wish to buy the goods of other countries should have just the same right to information, and


mark of origin on all goods would meet the need there.
I am not totally opposed to some protection for producers, if that is a by-product of giving greater protection to the consumer, and I think that this may well apply to the producers of quality goods in particular. The goods which we produce in Stoke-on-Trent are, in the main, high-quality goods at competitive prices. I do not see why we should make it more difficult for such manufacturers to maintain their industry, their craftsmanship and their quality when so few countries seem willing to inflict corresponding restrictions on their industries.
I ask the sponsors of the Bill to consider carefully the wording of new Clause 1 and to see whether they can at a later stage accept it or a similar form of words. It would greatly strengthen their Bill.

Mr. Edward Lyons: I add my congratulations to the Minister. His new Department has a vast empire and a reputation for stretching the talents of its Ministers, keeping them fully occupied. I know that he will have an engaging and interesting time there, and I hope that he emerges with added lustre and unscathed.
The Bill is welcomed on both sides, and I congratulate its promoter and sponsors, but, as has been said several times, it does not go far enough. Why do people decide not to put the mark of origin on their goods? Those who are proud of their manufactures hasten to indicate the origin on the product. Those who are ashamed are happy to leave the product in anonymity, hoping that the consumer will give it the benefit of the doubt.
Our concern is for the rights and protection of the consumer. Consumers may mistakenly take the same view of the product as does the anonymous manufacturer who decides that he will be better off if he does not give any mark of country of origin. Clearly, therefore, the absence of such markings will tend to increase the import and sale of goods from manufacturers who are ashamed to mark them. That increase will militate against the sale of goods of British manufacturers, particularly in the clothing and textile sectors, both of which have an excellent reputation for their products,

and both of which are proud of the goods which they make.
I shall not make a speech on behalf of protectionism, but I endorse all that has been said about the need to give maximum information to the consumer, first, because of questions of quality, and, second, for the other reasons why consumers want to know the origin of goods offered to them. For instance, there are many people who do not buy South African goods, not because the goods are inferior but for other reasons. I do not complain that some goods are made by cheap labour, but I should complain if they were made in slave labour conditions or by child labour. If I knew that a garment was made in a country where child labour was employed I might well be deterred from buying it simply because I knew that fact and to mark my disapproval of it. That knowledge will be denied to the British consumer in future, and that is an unfortunate situation.
2.0 p.m.
The point has been made, and it is worth making many times, that in an establishment which is known to have its own factories but which also has retail branches there is an assumption, usually in the absence of a contrary indication, that the products sold in the retail branches come from the factories of that enterprise. We know that large manufacturing organisations with retail outlets in this country are importing increasing quantities of goods. I have heard that one very large clothing manufacturer is now importing some 30 per cent. of the clothing which it sells through its retail chain.
Last year's figures show that the import of outer garments into the United Kingdom increased in value by 37 per cent. to £107 million compared with 1970. The number of garments, estimated at 109 million, showed a 40 per cent. rise. These figures come from the Wool Industry Bureau of Statistics in Bradford and these are the figures which shocked the wool textile industry, which is affected, albeit indirectly, by imports. It is expected in the wool textile industry that the floodgates will open with the removal of the legal obligation to mark imported goods.
It always seemed to me that words like "foreign made" and "Empire made"


were very teasing in that they left me speculating in frustration about the origin of the goods. Now we shall have a situation where there will be no indication.
In my constituency mills are closing down week by week, and the unemployment rate is now about 7 per cent. Any legislation which denies these people equal competition in the sale of their goods must be regarded as reprehensible and unfortunate by those who have the interests of the textile industry at heart, and I therefore qualifiedly welcome the parts of the Bill which force some origin marking but I very much regret that unmarked goods will be free of all restraint.

Mr. Normanton: We have had about three hours' debate so far on Amendments which clearly, as reflected in the Bill's sponsorship and in all the contributions during the debate, showed widespread, indeed universal, support for the Bill in principle. It is difficult therefore in this debate to avoid covering at least some of the ground which has been covered already but there are a few points I would wish to add to those which have already been made.
It makes a nonsense to try to separate the interests of the consumer from those of the producer. We are all producers in some form, and we are all consumers. As one of the sponsors of the Bill, I know, having regard to a considerable interest in certain sectors of industry, and one in particular, that the representations calling for action in the form of this Bill have come overwhelmingly in the early stages from producers in the very narrowest sense of the word. I do not think it was unrealistic that these representations should have been made.
Within the confines of the international trading philosophy of the liberalisation of trade, which is growing continually throughout the world, the message has been driven home clearly but painfully to the trade associations which made these representations that legislation would be hypocritical were it to appear to be, or were it actually, concentrated exclusively on the interests of the manufacturer of goods. This has been a considerable inhibiting factor in the drafting of the Bill, in that all one's attention

has had to be concentrated within the rather narrower confines of the use of the word "consumer".
I have no doubt that the Bill and the Clause will not go the whole way to satisfying the manufacturers of goods to which the Bill will apply. I doubt whether the Bill will apply to more than 60 or 70 per cent. of all imported goods, but at least it is a positive and constructive step in the right direction. It was a step which was becoming increasingly urgent with the approach of the end of the Trade Descriptions Act, 1968, and its demand that the country of origin should be attached to all imported goods after, I think, the end of November. The Clause will be a contribution, however, inadequate it might appear to many people, and at least it will be constructive.
Points have arisen during discussion on the Amendments to which I would like to add my comments. I refer in particular to the last point by the hon. Member for Bradford, East (Mr. Edward Lyons). He made an extremely valid and valuable contribution when he drew the attention of the House and, I hope, through the news media, of the whole country to the ever-increasing submergence of the identity of the true manufacturer and the true source of goods under the heading of "own brand". Distributors and so-called manufacturers' "own brands" mean that the source of manufacture is totally unconnected with the name so conspicuously marked and emblazoned upon the packaging and the display associated with the sale of the goods.
I would like the House and the country clearly to recognise that the Bill will cover "own brands", and were any retail distributor to offer goods marked with his company's name he would be required by the Bill to show the country of origin clearly and conspicuously at the point of sale. Therefore, this will be a major improvement in consumer protection. Although it covers only a sector, it will be substantial once the message is received in the distribution sector.
The predecessor of my hon. Friend the Minister declared last October or November that it was the Government's wish to support my hon. Friend the Member for Leicester, South-East (Mr. Peel) in


his attempt to deal with the situation which would apply after the ending of the sections of the 1968 Act in question. He did that intentionally to draw to the attention of the country as a whole, and importers in particular, that although legislation might take a considerable time to take effect they would be very ill-advised to take advantage of an interim hiatus to import goods other than with the appropriate marking on them. But perhaps I had better be careful not to trespass into the province of the next Clause.
The Clause we are debating is part of a Bill which will be read in conjunction with the 1968Act. Together with that Act, the Clause will be an extremely powerful piece of legislation so long as the forces for inspection and taking action against offenders are adequate. The adequacy of such provision is not a matter for debate now, but no doubt we shall have an opportunity before the Bill is enacted to draw attention to the inadequacies as we see them.
The Committee should also be aware of the question of stores' displays. The distribution industry as a whole should take careful note that where goods are offered for sale in association with displays and other forms of sales promotion techniques, and where they incorporate the name of the vendor, not the manufacturer, the vendor at the point of retail sale will be under a statutory obligation to puton the advertising medium—the posters, the counter displays—the country of origin of the goods he is selling. This must be carefully noted, even though it may cause strong objections in certain quarters. The sponsors of the Bill are determined that the public shall not be deceived on the issue of country of origin and the use of names in association with imported goods.
I was most grateful for other contributions to the debate, particularly one from an Opposition Member who referred to the use of symbols. I think he was referring to the use of things like tartans, Scottish thistles, kilts, the haggis, and so on, in conjunction with the offer for sale of goods, whether solid or liquid, which were not made in the Highlands but which the advertising would lead a gullible public to believe were made there. There are sections of the 1968 Act covering that point. My great regret is

that the use of that Act has not been as extensive as we might wish. The public—whether consumers or producers is irrelevant, because they are still members of the public—also have a rôle to play, even if not in a statutory sense.

2.15 p.m.

Mr. Molloy: I very much support what the lion. Gentleman has just said about the public's having a rôle. Does he not agree that the medium by which public opinion could be focused was the Consumer Council, and that it would be a good thing to re-establish it?

Mr. Normanton: I am grateful for the hon. Gentleman's intervention, but I doubt whether the Chair would allow me, in debating the Question "That the Clause stand part of the Bill", to refer to a matter which is not included in the Clause. Perhaps the hon. Gentleman's views have been noted. There may be strong views on the matter held on both sides of the Committee.
The Minister's predecessor has made it clear that consumer protection will not be met adequately or totally, or more than partially, by the Bill. I believe there are pledges that legislation to cover this field—I earnestly hope a much wider field than that covered in the Clause—will be introduced at the appropriate time. There is deep, widespread and genuine concern that the public are, have been, and always will be deceived if certain things are allowed to happen. One is the absence of all the facts relevant to their purchases. In that connection I was delighted to hear an hon. Member refer to the intention within the E.E.C. to introduce directives requiring fibre content specifications to be attached to labels on textiles of all forms. Fibre content is only one of many hundreds of characteristics about which I am certain the general public are deeply concerned.
I have said that the public have a rôle to play. If they will recognise the importance of the flow-back to retailer, distributor and manufacturer resulting from the part they play, the consumers will be the better served. I am referring to the need to be much more conscious of quality, price and value than this Bill and certainly Clause 1 can possibly cover. There are, tragically, within the context of matters other than trade descriptions,


far too many sectors in which the public are lamentably and to their own great disadvantage, both individually and collectively, not sufficiently conscious or alive to their rôle.
There is one other sector to which I draw attention. This is the rôle of the trade associations. I have referred to the fact that the mass of representations which was building up in the early part of 1971 came almost exclusively from trade associations. I think that the form in which those representations were made—clearly, openly and honestly within the context of manufacturers'protection—showed beyond doubt amongst their ranks as manufacturers, and including in this context the trade unions associated with them, a deep concern for the consumer interest.
I ask these trade associations to pay special attention to the part they will be required to play once the Bill is enacted. Although not specifically defined in Clause 1, it is the general one of policing by checking for malpractices and attempts at misrepresentation by those who offer goods for sale to the consuming public, and by alerting the authorities concerned—namely, as will be referred to in the combined 1968 Act and this Bill, the weights and measures inspectorate, which has an important rôle to play.
I deeply regret that a totally inadequate effort has been directed by the trade associations to advising—I cannot say ordering—if not influencing their members, the manufacturing firms in membership with them, to insist upon the use of the mark "Made in Britain" or "British made". This is where the trade associations will have an increasing rôle to play. They recognise it, I think, but appear to have done insufficient to drive the message home. They are greatly inhibited, as they and many manufacturers know, from attaching "British made" for the reason that more and more of their goods are being sold in certain supermarkets and very powerful multiple stores which specifically or by devious means prescribe that no indication of origin should be made, whether the goods are British or not, for the sole purpose of making it more difficult for the consumer to identify the difference between

those goods which are coming more and more into the shops from sources abroad and those manufactured in this country.
It will cause considerable heartache amongst various sectors of the distributive trades to disclose the country of origin, but at the end of the day any distributive organisation, retailing or otherwise, which fails to recognise the importance of maintaining the interests of the consumer is being totally irresponsible, and it is to avoid or reduce substantially irresponsible, flagrant violations of the interests of the consumer that this Clause has been drafted. I have pleasure in supporting it.

Mr. Alan Williams: I was intrigued by the assurance we had from the Under-secretary of State about the need to have identifying markings on foodstuffs from abroad in their original containers. I am sure that we look forward to a considerable improvement in the aesthetic surroundings of certain West End restaurants when the French snails in their original containers are duly presented stamped with the tricolour. For this, his first act as Minister, the hon. Gentleman deserves to go down in history and be remembered.
Our new Clause 1 was intended to be probing in order to give a chance for discussion. We have had the required discussion. I am in no way criticising the draftsmen of the Bill and its sponsors, but a gap in the legislation has emerged which is covered neither by the 1968 Act nor by the Bill. This is in relation to advertising away from the point of sale. This is a possible abuse. I am not saying that there is any serious evidence of it at the moment but it is something which may merit the attention of the Department to see whether any tightening up is necessary.
I assume that in any case the Advertising Association would quickly endeavour to act if such abuse was drawn to its attention. But this association, generally concerned as it is, still has a very limited budget on which to try to scrutinise over £1,000 million of advertising in this country. It may well be that we shall need to extend the protection which hon. Members want to give to advertising away from the point of sale. However, that is not a point we need press now.
We still maintain that the Bill probably is not needed and that everything it does could be done under the 1968 Act. I am sorry to say it in his absence, but we suspect that the need for the Bill is one of the repercussions of the thoroughly mischievous rôle played by the former Under-Secretary of State, the hon. Member for Cirencester and Tewkesbury (Mr. Ridley). I in no way blame the new Under-Secretary of State in this situation, but his predecessor made a point on television of creating a completely false impression of what powers already existed and of saying that the situation was purely the result of the wicked Labour Government's policy of repealing the 1926 Act. On Second Reading of this Bill, however, the hon. Gentleman himself said:
Therefore, I entitrely agree…that it was right in the Trade Descriptions Act to repeal the 1926 Act."—[Official Report, 25th February, 1972; Vol. 831, c. 1729.]
Once the 1926 Act was repealed, inevitably as a consequence any orders made under it were repealed.

Mr. Molloy: Was not the broadcast itself a misleading advertisement?

Mr. Williams: My hon. Friend is right. Perhaps we might refer it to the Advertising Association.
A further cause for trouble, as was indicated by the hon. Member for Cheadle (Mr. Normanton)—who did most of the drafting—is that the trade associations have been guilty of indolence and ineptitude. They have been indolent because they did not use the time available when they knew that the 1926 Act was to be repealed. They have been inept because, once they became aware of the significance of that repeal, they did not take account of the advice of the then Minister of State, who indicated clearly the form in which they should present their representations if they wanted marking orders made. If only they had done a small amount of homework, used a little commonsense, avoided the presentation of a manufacturing protective case and geared their case to the point of view of consumers, we would not need to deal with this piece of legislation.
2.30 p.m.
We are in the strange position that over 40 applications have been made for marking orders but none has yet been

approved. As my hon. Friend the Member for Colne Valley (Mr. David Clark) pointed out in his excellent opening comments, a recent survey undertaken by the Sunday Times made it absolutely clear that 94 per cent. of the people covered by the survey felt that marks of origin were important. I know the Government are somewhat sensitive on the referendum approach to assess public opinion but this is on a small scale. I am sure it would not create a major constitutional precedent if they took note of the findings of this poll. It was a clear indication of consumers' wishes. The consumers want to have the country of origin marked on products. It is not good enough for the Government to tell them that they know better than consumers what they want. That is what has been said.
The Prime Minister in a letter to my hon. Friend the Member for Colne Valley said:
But I do not think that we can seek to protect people against the unreasonable assumption that the absence of a name or mark indicates that goods were made in the United Kingdom.
Why not? If it is an unreasonable assumption, that does not alter the fact that it is an assumption made by a good many people. If it is made and is misleading them in some way, it would seem to me quite relevant for us to seek to protect the consumer against being misled.
I am bound to ask, from whom will the Government accept consumer advice if they will not accept the findings of a poll showing that 94 per cent. of the public want this? If they then abolish the one focal point for consumer opinion, the Consumer Council, which apparently they were willing to heed, what now do they consider to be adequate consumer representation in putting forward applications for marking orders and definition orders? Although such orders are outside the scope of this debate, they are every bit as important for the consumer. The Government have shown themselves completely schizophrenic on this whole issue about not having an extension of the system of origin markings.
In the Second Reading debate the former Under-Secretary based his case on the fact that this would add to the cost. He spoke about the extra stock that


would be needed for each mark and he built up his case on the cost that would arise. On the other hand the Prime Minister in that same letter to my hon. Friend said:
Indeed, if all home producers were to indicate where their goods were made, as so many do, this would reinforce the more natural inference that unmarked goods are probably imported.
The Under-Secretary also said, later in the debate:
British manufacturers—I hope all—will write 'Made in Britain' on their goods".
This leaves us in a rather peculiar situation. If costs are negligible, the former Under-Secretary's initial argument falls. If on the other hand the costs are substantial, it seems a strange proposition that, faced with the substantial cost of marking, the Government's answer is to say that the problem can be solved if a British firm marks but they will allow a foreign competitor's goods to come in unmarked. Either way the Government do not have a case.
The former Under-Secretary made the point that quality and origin were not synonymous. Then, when he was issuing his injunction to British manufacturers—"I hope all"—to write "Made in Britain" on their goods, he said:
That would be a mark of quality which would sell those goods.
It seems to be argued on both sides of the case as and when it suits the Government, as long as there are enough column inches between the arguments so that no one will notice there are points of disagreement.

Mr. Normanton: There is a point here which may have been overlooked. I refer to the Molony Committee. I want to keep off partisanship because there is clearly universal agreement on this subject. The Molony Committee's recommendations reveal a dichotomy. I interpreted the main text as suggesting that markings of origin are on balance desirable from the consumer's point of view. In the final summing-up it rejected this. Clearly much of the thinking in the past, on both sides, may have been heavily influenced by mis-selecting the appropriate parts of the Molony Report.

Mr. Williams: I am grateful to the hon. Member. I accept largely the point

he seeks to make. It is unfortunate that the former Under-Secretary is not here to defend himself. That is not his fault because I certainly had not initially intended to pursue this argument. It seems relevant to establish that the need for this legislation would not have arisen had it not been for an interpretation by the hon. Gentleman in one part of his Second Reading speech when he quoted the 1968 Statute:
expedient in the interest of persons".
He went on to say:
That word 'interest' is perfectly clear. It means interest in terms of quality and value for money."—[Official Report, 25th February, 1972; Vol. 831, c. 1713–35.]
That was his limited interpretation of what "interest" meant. It was his interpretation but it was not perfectly clear. It is clear as has been pointed out that there are many consumers with a genuine and material interest, highly relevant to them when making purchases, in knowing whether goods come from South Africa. There are all manner of other reasons why people may wish to know a country of origin. To bring it down simply to quality and value for money is taking too narrow a view of the consumer interest.
It is from that decision by the hon. Gentleman that much of the frustration in industry had flowed. The hon. Gentleman bears a considerable responsibility in this respect particularly when at another stage he almost admitted that a marking could be an indication of quality. This is not a controversial piece of legislation. The only controversy is whether it is needed. We have no intention of blocking it or opposing it. We are grateful to the hon. Member for Leicester, South-East (Mr. Peel) for responding to what he saw to be a need. My complaint is that the need need never have arisen and that legislation already existed.
It is not legislation that will make for more vigorous consumer protection. The only thing that will do that is the will of the Government to use existing legislation, and this Measure when it is passed. What has been lacking at the Department of Trade and Industry is the will to use legislation. The new Under-Secretary is of a sturdy temperament and aggressive in his approach to problems. I hope he will take a wider interpretation of the legislation and of his powers, thus giving the widest possible consumer protection.

Mr. Emery: I speak before my hon. Friend the Member for Leicester, South-East (Mr. Peel) because, although the debate is on the Question "That the Clause stand part of the Bill", it is likely to be the last debate that we shall have here on the Bill. As I do not think there is a need to prolong matters too much, I feel it only right and proper that, so far as the Government are concerned, we should now pay particular tribute to my hon. Friend for the way in which he has piloted this Bill through the House. I pay tribute to the diligent work which both he and my hon. Friend the Member for Cheadle (Mr. Normanton) have done on this Bill and in trying to ensure, as they have, that the Bill was considered with co-operation between all sides and with considerable ease and a modicum of friction. I therefore congratulate my hon. Friend immensely.
I would point out something which, so far as I know, has not been pointed out yet. It is fairly unusual that a Private Member's Bill should go through the House bearing the name of a senior Minister. My hon. Friend the Member for Leicester, South-West (Mr. Tom Boardman), who is now the Minister for Industry, is a signatory of the Bill itself. This seems to have been a Leicester field day, especially with my hon. Friend the Member for Harborough (Mr. Farr) also participating so much in the debates.
Another reason for my rising is that certain questions which have been put were put more to the Government, I think, than to the sponsor of the Bill, and, that being the case, it seems to me that it would be wrong not to respond to them.
The hon. Member for Ealing, North (Mr. Molloy) asked me specifically about spare parts. The answer to that is, I think, clear if he thinks it out. If there is a British brand or mark on the spare part, that would imply that it was British. If it was imported there would need to be on it an annotation of the country of origin. If, however, the spare part is part of an initial sale, or part of an initial purchase, then it is part of the overall sale and will not necessarily have to be so stamped.

Mr. Alan Williams: I think the hon. Gentleman is in danger, quite unwittingly I am sure, of misrepresenting what my hon. Friend said. He made the point

that these were components from abroad which had no stamp whatever on them but could be identical with British components.

Mr. Emery: Then the situation is as it is at the moment. Only if there were an implication that it might be a British mark or name would the country of origin have to be annotated.
I was impressed by the point put by the hon. Gentleman the Member for Accrington (Mr. Arthur Davidson) when he talked about the abuse of any mark in such a way that it could be misleading. Obviously, it is the view of the Government that there should not be abuse, and that is why we have seen it right and proper to give the support which has been given to my hon. Friend in bringing forward this Bill.
2.45 p.m.
The hon. Member for Swansea, West (Mr. Alan Williams) said he had never seen or heard the argument by Government that the Government should amend the 1968 Act, and a similar argument was made by the hon. Member for Colne Valley (Mr. David Clark). The answer is that, of course, there could have been amendment, but, as the hon. Member for Swansea, West will know, when there is a good deal of legislation to be proposed by the Government, then if a Private Member is able to come forward with as excellent a Bill as this has proved to be the Government are willing to try to ensure that their support is given to it. This has been apparent in this case.
The hon. Member for Swansea, West was pulling my leg slightly when he said he was delighted at the thought that I would be held responsible for a snail having to bear a tricolour as a mark of origin. I would only respond by saying that if he can produce to me some snail with a British mark on it he will make his point for having his tricolour, but till then I think the Bill will stand as it is.
The point has been made that the British public will not realise that unmarked goods may be British. Again, the argument has been propounded in the Committee today that people will not know that unmarked goods may be foreign. One cannot have it both ways. The situation is that the Government


have seen fit in backing the Bill to try to ensure that a certain degree of protection is given—absolute protection—so that where a name or mark is used which would imply that imported goods are British this shall be shown not to be true by the fact that the country of origin is named on them. This is a major step forward.
I do not accept what the hon. Member for Swansea, West said in attacking my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley). It seemed to me that what the hon. Gentleman said was entirely a misinterpretation of the views which had been expressed by my hon. Friend. My hon. Friend the Member for Cirencester and Tewkesbury went a very long way towards persuading certain people who might have opposed this Bill at certain times that it was a useful Bill to bring on to the Statute Book. I certainly believe that he deserves all the credit for that. I have inherited the work which he was doing on the Bill. It would be wrong to understand anything else but that, and here at this Dispatch Box I pay tribute to the work which my hon. Friend the Member for Cirencester and Tewkesbury has done on the Bill both in preparation for the Bill and, on the Government's side, during the passage of the Bill.
There is one other thing I feel I should say. There is a feeling that if something bears no mark at all people will be unable to judge whether it is British or foreign. What matters is the quality of the goods themselves. If a British manufacturer thinks it is to his advantage to describe his goods as being "British made" it is completely within his power and his ordinary commercial judgment to do so. He can have stamped on his goods "Made in Britain", "Made in England", "Made in the United Kingdom" or whatever phrase he wishes, even "Made in Wales" or "Made in Scotland". Just before Christmas I purchased a gold tinsel Christmas tree, on the box of which was marked "Made in Wales". I asked several people where they thought the tree might have come from, and they suggested a hundred and one other countries but no one suggested that it had come from Wales. The hon. Member for Swansea, West might be interested in that example.
The manufacturer has the right to mark his goods if he believes that they may be unfairly judged in competition with foreign goods. A prime example is my tinsel Christmas tree, which was in competition with Christmas trees from Hong Kong. The manufacturer expected that people would think it to their advantage to buy a Christmas tree made in Wales. It is within the manufacturer's power to do this if he feels that his customers may be deceived or are not able to make a judgment about the quality of the goods which he is putting on the market.
Whilst one or two hon. Members have suggested that the Bill does not go far enough—and I listened with interest to the interventions of the hon. Members for Stoke-on-Trent, North (Mr. Forrester) and Bradford, East (Mr. Edward Lyons)—I believe that we have gone a long way to meet the major objections to the Bill. I am, therefore, delighted to pay tribute to my hon. Friend the Member for Leicester, South-East for his work in bringing the Bill before us.

Mr. Alan Williams: In case my earlier criticisms were misinterpreted against the hon. Member for Leicester, South-East (Mr. Peel) I should make it clear that we, too, congratulate him on the way he has presented the Bill and has tried to meet the reasonable criticisms that have been expressed.

Mr. Peel: As Clause 1 goes to the heart of the principle of my Bill, perhaps it will be in order for me to say a few words about the debate that has taken place. Before doing so, I take this opportunity of warmly congratulating my hon. Friend the Member for Honiton (Mr. Emery) on his translation to the Front Bench—a well-deserved honour. I feel I may say this because he and I have worked closely together in the Council of Europe and in Western European Union and I have had every opportunity to learn how energetic and able he is and how much he has contributed to the work of the House of Commons both here and abroad. I am therefore delighted to see him where he is.
I also thank my hon. Friend for taking over the Government side of my Bill from his hon. Friend and for having done it so ably at such short notice. It would not normally fall to him to have to deal


with this subject, but in the circumstances he has had to do so and I greatly appreciate the way in which he has done it. He has impressed us all by the way he has handled the Government side.
I congratulate the hon. Member for Colne Valley (Mr. David Clark) on coming to the Opposition Front Bench. I greatly welcome his appearance there and appreciate the way in which he spoke on the new Clause. I hope he will long remain on the Opposition Front Bench and that he will shadow my hon. Friend for many years to come.
I also thank my hon. Friend the Member for Cheadle (Mr. Normanton) for his splendid support and sponsorship of my Bill. He is an expert on this subject and without his able support and contribution to our debate I should have found it very difficult to take the Bill through. I appreciate that very much. I thank all the sponsors and others who have contributed.
I am particularly grateful to hon. Members opposite for saying that whatever criticisms they may have of the shortcomings of my Bill they nevertheless accept it and support it in principle. I understand that it may not go quite as far as some people would wish. On the other hand it goes a lot further than some other people would wish. My object is not protectionism—that is the last thing this country should go for; we should go for more and freer trade—or to discriminate against or restrain international trade in any way. My main object is to protect the consumer from deception. This is a farily restricted but important object. To say that the Bill should go further and give the consumer complete protection, and that even goods which bear no mark upon them should be labelled with their country of origin, would be to go a little far and would tend to under-estimate the native intelligence of the British housewife.
The British housewife in her shopping habits is becoming a great deal more educated, discerning and discriminating as time passes. I remember a friend of mine who travelled over from America found himself in conversation with an American. They swapped stories about what each other did, and the American said "I reckon that there are about 50 million fools in the United States, and I live on them". I would not dare to

say that about the British housewife. The British housewife is very discerning in her shopping.
My hon. Friend the Member for Harborough (Mr. Farr) spoke about guns. Firearms are very special articles. On the whole, people who buy them are fairly knowledgeable. Completely ignorant people do not walk into a shop, pick up any old gun and buy it. Those who go to buy guns are discerning and discriminating, and adequate protection is given to them by the old Acts of the last century which are still in force and provide that guns should carry qualitative marking. So my hon. Friend should not worry too much on that score.
3.0 p.m.
I take the point made by the hon. Member for Swansea, West (Mr. Alan Williams) on the question of advertisements that are not connected with an article. The situation needs to be watched.
I agree with what my hon. Friend the Minister said about his predecessor. I do not think it was a matter of lack of will in making the Trade Descriptions Act, 1968, work. It was rather more of an oversight by industry and trade that they did not make as much use of the Act as they could have done.
Section 8 of the Trade Descriptions Act, 1968, is a somewhat inappropriate and clumsy weapon to cover all aspects of the problem. I agree that a gap existed which needed to be closed in a somewhat simpler way rather than that orders should be brought in to cover every conceivable matter—in other words, to have something across the board to cover anything which might be misleading concerning manufacture.
I am anxious that it should be realised that the Bill seeks to supplement the Trade Descriptions Act, 1968, and should be read with the provisions of that Act. Anything that escapes from the Bill, if it becomes law, will certainly be caught by the provisions of the 1968 Act. If both pieces of legislation are taken together, I feel it can be said that the ground has been thoroughly covered.

Question put and agreed to.

Clause ordered to stand part of the Bill.

Clauses 2 to 4 ordered to stand part of the Bill.

Bill reported, without Amendment.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed.

COMPANIES BILL

Order for Second Reading read.

3.4 p.m.

Sir Brandon Rhys Williams: I beg to move, That the Bill be now read a Second time.
I should like to begin by adding my warmest congratulations to my hon. Friend the Member for Honiton (Mr. Emery) on his promotion to the Front Bench. I have often criticised the experts who have only learned about industry from books; but my hon. Friend is one of the relatively few Members of the House who have learned about industry from personal participation in management. I feel certain that this will ensure that his appointment is as warmly welcomed in industry as it is in all parts of the House.
However, I wish to express two regrets. The first is that my Bill, coming very closely after the one we have just dealt with, will deprive my hon. Friend of his lunch. I hope he will not end by making a meal of my Bill. My other regret is that my hon. Friend's promotion is likely to weaken our delegations in Strasbourg and at W.E.U. However, my hon. Friend will have many new opportunities of showing himself to be a good European in his new appointment. We wish him every possible success.
I am returning to one of my favourite themes. It concerns the problems of the joint stock company and the need for reform. In 1969 I introduced a Bill under the Ten Minute Rule on this subject. Its object was virtually identical to that of the present Bill, but I was tackling the problem in a different way. My intention in that Bill was to introduce into statute law the expression "management audit" and to give facilities to shareholders who felt so disposed to insist that a management audit should be instituted under the general supervision of a shareholders' commit-

tee. That Bill was read a Second time and completed its Committee stage in this House. However, by the end of its Committee stage it had become a more complicated Measure than I would have wished it to be.
Therefore in reverting to this subject last year I tried to devise a simpler method of attaining my object. The Bill that I introduced last June, again under the Ten Minute Rule, was virtually identical to the present one. In reintroducing it I have made some small drafting improvements. There is one other change which students of politics and company law may notice, though I shall not mention it now for fear of embarrassing an hon. Member who is present in the Chamber. It can be detected by serious students of the texts.
The present Bill enjoys all-party support and among the distinguished right hon. and hon. Members who were kind enough to add their signatures to it when I explained the nature and intention of the Bill are two formers Ministers at the Board of Trade.
Before completing my preliminary remarks, I wish to convey my thanks for the assistance I have had from members of the Department—acting, of course, purely in an advisory capacity and in no way committing the Department to my Bill. Their assistance has been invaluable. If the Bill has the makings of a professional job it is due to their advice and not to my drafting skill.
In the Bill there are only two essential provisions. The first is that large quoted companies—those with £5 million total net assets or employing more than 1,500 workers—must have at least three outside or non-executive directors. This provision is designed to catch the thousand largest companies operating in Great Britain. In Sir Walter Puckey's excellent book "The Board Room" I read that it is now a provision of the New York Stock Exchange that a quotation is not given to a company unless it has at least two outside directors. As a result, nine out of ten companies quoted on the New York Stock Exchange have at least two non-executive directors. I have suggested that there should be three. The number is not significant. I hope, however, to ensure that there is a significant element of outside direction in all our largest public companies.
The other main provision of the Bill is that the non-executive directors must prepare an annual report to be attached to the balance sheet—that is, to be issued annually to the shareholders. The remaining provisions of the Bill are purely subsidiary or interpretive and are not of great significance.
It is useful for the House to consider precisely what is the nature of the problem to be solved. I consider that it is the maintenance of efficiency in joint stock companies and the correction of any decline in efficiency at the earliest possible stage. The difficulties which I believe joint-stock companies are experiencing in the latter half of the twentieth century arise from a number of causes. One of them is the ever greater complexity of modern business and technology. Another is the huge number of public companies. There is the wider extension of share ownership. None of these is necessarily a tendency with which I do not agree, but their effect must be taken note of. We must recognise the strains which they place upon the joint-stock company as a mechanism for the creation of wealth.
I would like to draw attention too to what is loosely called the managerial revolution. In our largest companies we have now seen virtually the end of the owner-manager. We have also seen virtually the end of what I might call the "Forsyte Saga" type of board where men of considerable business ability, no doubt, would hold a range of directorships in companies which they did not manage and whose boards they joined for purely supervisory purposes.
Before the war, and in some cases even since the war, it was commonplace for the boards of British companies to consist mainly, if not entirely, of notabilities who might bring business acumen and reputation to the service of the company but who did not engage full-time in its management. This situation has largely come to an end; and it is common, if not absolutely universal, for the great majority of the directors of great joint-stock companies to be men who are fully engaged in the business. Many of them probably have worked their way up within the very same business from the start of their career.
I consider that all these factors are working to make it increasingly difficult

for shareholders to exercise effective supervision of the joint-stock company. A remedy to this situation must be found urgently.
In passing, as it is one of my hobbyhorses, although it always creates a somewhat sulphurous atmosphere with my hon. Friends, I may say that I blame the Government for their lack of action on the question of transferability of pension rights. If the full-time executives of our businesses were able to plan their own careers without the fear of losing their pension rights on changing employment, much greater efficiency would be engendered by the executives being free to exert pressure by what one might call "voting with their feet". I implore the Government to bear in mind the urgency, particularly when a serious shake-out of management is occurring, of acting to ensure that there is full transferability of pension rights throughout the private sector. Great strides have been made in this regard in the public sector; but private companies still suffer from the restriction on mobility of pension rights, which inhibits executives from making the best use of their capacity.
What, then, are the forces that are working for greater efficiency in a joint-stock company? Are they enough? Or can we expect that they will do all that is necessary in the near future?
We must pay tribute to the Press. In recent years the Press has emerged as a most important factor serving shareholders, the general public and, indeed the Government by exerting an important and effective pressure on boardrooms to improve their performance. Press coverage has changed out of all recognition in recent years in both quantity and quality. However, I cannot believe that members of the Press, who essentially are outsiders, are able to do all that is necessary to correct the problems of the joint stock company.
Next, particularly since the war, the takeover bidder, prowling around looking for inefficient managements sitting on top of assets of which they are not making the best use, has made a certain contribution, at any rate, to the elimination of the unfit. But a takeover bidder is not a company doctor. He is an executioner. All too often it is the people who are most in need of improving their performance who have no realisation of the fact


that they are sitting targets for a takeover. The spate of takeovers and mergers which have taken place in the last five or 10 years has not always proved to be the most effective way of maximising the profitability of the assets or, indeed, protecting the interests of the shareholders in the long run.
Some hon. Members—who seem to me to have learned more about industry out of books than from practical experience and I am ashamed to say that they are to be found on both sides of the House—place a great deal of reliance on the forces of competition to create efficiency. I can only say that in my own experience some monopolies can be outstandingly efficient; and that competition often causes waste, nervousness and the elimination of the most promising firms in an industry. Competition, too, is never likely to be tried in the Ricardian sense. It is always bound to be an imperfect force. I cannot anticipate that in this country, even if we join the Common Market, the forces of competition alone will be sufficient to bring about the improvement in the general climate of British industry which we would all like to see.
I wish to dwell for a moment on the rôle of the institutions—the unit trusts, the investment trusts, the pension funds, insurance companies and the banks. Undoubtedly it has become recognised by the men responsible for handling the enormous funds available for investment by these institutions that they have a responsibility to exert pressure on management for greater efficiency. I found a speech made by Lord Keynes as far back as 1928, as chairman of one of the great insurance companies in those days, in which he implored the institutions to take a more active part in promoting efficiency and supporting enterprise in this country. I will not weary the House by repeating in full the remarks which he made, but they are so totally germane to what we are discussing and to the general problem of the joint stock company that I strongly commend any hon. Member who is interested to look them through. I reprinted them in an article, and I shall be happy to supply a copy to anyone who is interested. The thoughts of that great man on this problem are so relevant that they should receive greater attention.
The institutions seem to me to be hampered by a considerable number of restraints to which I shall come in a moment. The other force which is operating for the efficiency of private enterprise is Government pressure of all kinds. The Government exercise pressure through purchase policy, through monopolies legislation, through the way in which they influence public investment and the conduct of the nationalised industries, and they may achieve great things, as we hope they will, through the Industrial Development Executive which has just been announced. But it seems to me that when all is said and done, when all these pressures have been exerted, we still have between £40,000 million and £50,000 million worth of assets under the supervision of joint stock companies. At least 2,000 British firms are quoted daily in the Financial Times, and there are many other public companies whose shares are regularly traded in London. I cannot believe that we shall be able to restore efficiency to all these very many large concerns unless any troubles from which they may be suffering are cured from the inside. That is the object of my Bill.
It has been suggested that the institutions and the shareholders can exercise all the pressure necessary on management, if they lose heart and feel that management is not doing its best, by selling their shares, by not buying them or by not subscribing to new issues and thereby bringing about a fall in the share price, which undoubtedly has a certain effect on management. My first comment about that is that over recent years such pressures have evidently not been enough; otherwise, the performance of the private sector of the British economy would not be causing us so much concern.
Moreover, shareholders will only act in these ways when information has reached them on which they are able to form an opinion; but it is essential to get at the problem long before it becomes common knowledge, or even before certain well informed or shrewd individuals have an inkling that there is trouble. The joint stock company must have its own correction system for management and must not depend on forces outside.
I would like now to return to the rôle of the institutions. Among the reasons why I feel that they are not able to act as effectively as they might or, indeed, as they would wish is, first, that they


cannot carry the number of sufficiently expert staff to understand the inside problems of the entire range of companies in which they hold shares. It is common for a large unit trust, investment trust or in particular, a big insurance company with a very wide spread of shares to hold an interest in scores or even hundreds of companies.
These institutions are in competition with one another. However much they may be dedicated to the idea of efficiency in British private enterprise, they cannot carry the staff of 20, 30 or, perhaps, 50 or more experts who would represent the bare minimum necessary to give them effective up-to-date professional advice on the whole range of industries and commercial activities engaged in by the companies in which they hold shares.
Moreover, even if a great institution or merchant bank were to decide that it was in its long-term interest to have a reputation for excellence and expertise in these matters, it could not insist on access to the necessary confidential information. Or, if it were in a position to do so, as, I suppose, some of our great City institutions are, it would become a privileged shareholder with access to knowledge not available to the general run of private shareholders.
I regard it as an unwelcome development that the private shareholder is dying out or becoming a less significant force in the whole field of investment. I do not myself hold any shares in any public company, so I may declare my total lack of direct personal interest in the subject which I am discussing. But each one of us in this country, whether a shareholder or not, has a stake in the success of our industry and business; so we are all interested parties.
I have detected certain tendencies in City institutions to feel that the existing facilities which they have for contacts and exchange of information with company managements give them all that they require if they wish to exert discreet pressures on a company which they feel is not performing as well as it might. But I know of no case in which there has not been at least the danger that inside information would be obtained which, sooner or later, would influence the institution in its attitude to the purchase or sale of shares in a way which would not be open to other shareholders.
Institutions, for special reasons, may not wish to exert pressure on certain companies. They might have relations with them in other ways. Or perhaps, if they began to exert pressure, it would upset the share price. One can think of many reasons why institutions, even in full knowledge of the development of a problem situation, might find themselves stuck and unable to act. I am sure it is not necessary to remind the House of a particularly serious case in which the institutions with big holdings found themselves locked in and able only to wring their hands in despair.
The Government cannot remedy the situation over the whole field, however much they may wish to do so by direct or even by indirect action.
Hon. Members have been deeply interested and concerned by the V. and G. case; I think that the rather unsatisfactory tribunal report on that case has at least shown that we are putting inordinate pressures on civil servants and asking them to make bricks without straw. The findings of that inquiry will serve a useful purpose if they awaken the conscience of the House to recognise that we have been placing pressures on the worthy and, in many cases, brilliant staff of the Department of Trade and Industry and asking them to do the impossible. I deeply regret that anyone's name should have been mentioned in a critical sense in the tribunal's report, because he was not able to do what he should never have been asked to do in the first place. But if we were to give the Department of Trade and Industry the necessary powers and knowledge to investigate and control the whole range of joint stock companies we would then have handed over completely to State control in a way in which I do not think even the most fanatical nationaliser would think practical or even desirable.
We therefore need an extension of the principle of the audit. If there are some who do not like the expression "management audit" let us fall back on some other expression, perhaps "the supervisory report". The important thing is that the joint stock company should now move a further stage forward in its evolution. It must again have the ability to put its own house in order.
Since the Bill which I introduced in 1971 was published, a number of objections have been raised by professional


institutions, by experts and by many others who have corresponded with me or in the Press. I am glad to have succeeded in attracting professional attention to the deficiencies of the present situation and I am grateful to those who have pointed out ways of improving my Bill. I would like to take this opportunity of answering as briefly as I can what seem to me the most serious of the possible objections to action being taken along the lines I suggest.
The first objection I have heard is that it is not right to proceed by legislation because the only trouble with management today is that there is too much Government interference. My answer is that we do not have the time to wait for organic change in the joint-stock company. The Government should recognise the existence of a real problem, and it is not inappropriate for minor measures to be taken which will assist the changes which are probably already taking place.
I suppose there must have been precisely the same kind of arguments a hundred years ago when it was first suggested that it would be desirable for the shareholders to be protected by an outside auditor. One could argue against the use of outside auditors in the same way as one could argue against the use of a management auditor or the employment of consultants. But these arguments do not have any force. These people are brought in and paid by the company to be part of the company, serving a useful purpose within it. They are not destroying it, not creating havoc or damaging the shareholders' interests, but quite the reverse. The Bill leaves it entirely to the company, the shareholders—institutional or private—and the directors to work out their own salvation by the arrangements they make without anyone from the Ministry telling them what they should be doing.
What I am suggesting will be recognised as a move towards the European pattern, towards the creation of an Aufsichtsrat as it is called in Germany, which is a separate supervisory board. The performance of the German economy since the war does not suggest that the presence in German company law of the obligation on all large firms to have a separate supervisory board remote from

the executive management of the company—which they call the Vorstand—has been so very damaging.
Another objection is that the Bill would result in boardroom controversies and splits. In the great majority of cases it would not. There would be harmony in the board when the outside directors have no reason to see any serious grounds for complaint about the way in which the management is conducting the business. They would then probably be happy to have the company secretary draft their report for them, and be willing to sign it. It would differ little in essence from the directors' report which will be prepared anyway each year. But where they begin to feel that a personality or asset was not being made the best use of, it would be good to have controversy in the board. What we need to escape from is the unanimity of the graveyard in company management. Splits, if they occurred, would tend to resolve themselves inside the board in the vast majority of cases, because naturally if a split came out into the open it would have serious consequences for the company—just as there would be serious consequences for the company if there were a dispute with the auditors which came out into the open in the form of qualification of the auditors' report on the accounts.
So the fact that the outside directors would be obliged to make a separate report to the shareholders would mean in practice that the status of the non-executive directors within the boardroom would be significantly enhanced. That seems to me a worthy objective.
Moreover, if the board did divide into a supervisory and an executive board it would not matter. People who have studied the German system and found fault with it are concerned generally about the provision for worker participation on the supervisory board. That is an entirely different matter, and my Bill makes no reference to it. Right hon. and hon. Members who feel strongly about it should introduce their own Bills on the subject.
The Bill does not introduce a new kind of director, because the non-executve director already exists. All that the Bill does is to make certain that the non-executive director has status, that he exercises his functions and can be seen


by the shareholders to be doing so. If he fails to exercise a useful function, the shareholders will be able to make changes—if that seems to them the right thing to do.
Another serious suggestion is that it it is better to help shareholders by wider disclosure. The 1967 Act introduced much wider provisions for disclosure, and it is conceivable that it would be profitable to go even further down that road. But as a way of correcting the problems of inefficiency in joint stock companies at an early stage, I would say that wider disclosure has its weaknesses. First, the existing extent of disclosure has proved vexatious for smaller firms. Many right hon. and hon. Members would be prepared to see some of the demands for disclosure reduced again in the next Companies Act.
Moreover, no amount of disclosure that could be enforced on a joint stock company by Statute could ever reveal the whole story. In some years of industrial consultancy and personnel selection experience, I have time and again found that when one was able to begin to have long, serious, confidential discussions with senior and middle management the situation within the company was totally different from what one had assumed it to be before, even after extremely careful study of all the published data. And even if shareholders were enabled to ask for any information they wanted, I do not think their contributions towards the solution of the problem would necessarily be very well-advised. Wider disclosure seems much more likely to suggest the nature of the problem than the nature of the solution.
Looking back on what I learnt in over 13 years with I.C.I., I remember particularly the advice of a well respected works manager who used to tell his juniors "Do not come to me with your problems. Come to me with your solutions." He knew the problems. What he wanted to know from them was how they should be tackled. Wider disclosure will let the Press, the shareholders and the competition know—perhaps—whalt is going on. It may suggest the nature of the difficulties which the board is trying to contend with; but will it help the board to solve those problems? My feeling is that it is only likely to add

to the difficulties of the company and its management.
It has been suggested that people in this country do not exist who are capable of doing the work of a management audit. This is absolute twaddle. In this Bill one is asking for only about 3,000 people at the most. Since I do not envisage that it would be necessary for non-executive directors to hold only one such post, the Bill would probably require a cohort of only about 1,000 management auditors. I do not believe that the resources of commerce, industry and the City cannot find 1,000 people capable of carrying out this work. In so far as they would have to learn the job by doing it, it is true that we are at the beginning of a new profession. But the concept of outside auditing appeared in company law only about 100 years ago, and it first became compulsory as recently as 1900. It was only in 1948—many people are surprised to hear this—that it became statutory that an outside auditor should be professionally qualified. So the profession of auditing has taken 100 years to evolve, and, obviously, the extension of auditing into management auditing will take some time. That is no reason why we should not start this year.
Some people, including Aims of Industry—sometimes when reading its publications I think that one of its aims must be suicide—have argued that it is impossible to proceed without a full-scale reform of company law and that small measures should not be undertaken meanwhile. I have seen it suggested that there should be a Royal Commission or at least some much fuller study before anything is done. This is what I call the Greek kalends ploy, which comes often with warm assurances of support for what one is aiming at, but with shakings of the head that anyone on the back benches should be so ill-advised as actually to recommend that something specific should be done. In defence of my Bill, I would point out that, in effect, it is only a very small step, but it is a step in the right direction.
There are some small remaining points, really constituting Committee points. I hope that if the Bill secures a Second Reading it will be possible for me to introduce Amendments which will deal with them.
As regards the remuneration of non-executive directors, I think it would not be inappropriate for companies to pay them £3,000 or £5,000 at least. I hope, too, that these directors would not hold more than three or five such jobs at the most. It has been pointed out that the Bill is not sufficiently specific in saying how the shareholders are to decide the remuneration of outside directors on their first appointment. This needs attending to.
There has also been criticism of the definition in Clause 2 of "non-executive director". I suggested that he should work for the company in an executive capacity for not more than 100 hours. I agree that that provision could be improved. Possibly it would be better to suggest that any service that the non-executive director performs on behalf of the company in an executive capacity must be reported to the shareholders at the next annual general meeting.
I come to the nature of the non-executive director's report. I found what I thought was about the widest possible definition one could make—namely, that it must concern itself with the management of the company and the use of the company's assets. Even that may not be sufficiently wide. I meant that it must deal with the people and with the things. If any hon. Member would like to suggest a definition which would go wider or improve on that, I would be happy to adopt it.
If the Bill does not complete its stages, there is nothing to prevent shareholders from requiring their boards to implement its provisions in advance of general legislation. I hope they will. I believe that sooner or later they must do so if the joint stock company is to survive.

3.41 p.m.

The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): I intervene now not in any way to stop the debate but to give the Government's view of the Bill. The aim of the Bill is to promote the efficient management of large companies, and it is clearly one with which everyone would agree. To that end I thank and congratulate my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams) for drawing attention to one way in which this improvement can be achieved.
From the start I make it clear that, while the Government fully understand there is room—in some instances major room—for improvement in British management, in no way should it be taken that this Bill is an attack overall on British management, which bears such a massive burden in running industry and exporting throughout the world. Too often attacks are made upon management, and I want to make that point plain now.
The Bill requires very large companies to appoint to their boards at least three non-executive directors. It is a slight revision of the Bill which my hon. Friend introduced in June, 1971. These non-executive directors would have the duty of preparing an annual report on the management of the company and the use of its assets. Their report would be laid before the company in general meetings with the report and accounts of the ordinary directors.
There is wide recognition of the fact that in a large company shareholders may be unwilling to involve themselves in the trouble and expense of exercising their power over the directors either by refusing to accept nominations to the board or by dismissing the directors. The Bill seeks to deal with this problem, at least partially, by providing the shareholders with a report made not by the executive directors but about their performance. The provisions of the Bill could well divide a board with one part reporting on the other. I believe this to be a major problem which has not, perhaps, been thought out to the full. It is at least arguable that this is not the way to promote co-operation between all members of the board so that they work together in the interests of the company.

Sir B. Rhys Williams: Does not the appointment of auditors have very much the same effect? Can my hon. Friend instance any large company where auditors are so at loggerheads with the board that the management has been brought to a standstill?

Mr. Emery: My hon. Friend has not clearly seen my point. Auditors are not sitting at monthly board meetings with other directors. They do not have the executive power or the responsibilities of an ordinary director. The point I make is real. While the Bill is in many ways


admirable, it is only one way of correcting the situation.
That is shown clearly by the appointment last month by the C.B.I., in collaboration with the City and other institutions, of a committee on company affairs under the chairmanship of Lord Watkins on. Its terms of reference include examining
the factors which might be expected to assist the direction and control of public companies and corporations.
To examine the role, responsibilities and structure of the boards of public companies and corporations.
To consider corporate behaviour towards interests other than those of the shareholders and providers of finance, including employees, creditors, customers and the community at large.
I shall not quote the other terms of reference, but those which I have mentioned specifically apply to the matters covered by the Bill. The setting up of this committee shows that there is not general agreement on how best to achieve my hon. Friend's aims. In the Government's view, it would be premature to legislate on this wide subject at this stage on the lines proposed in the Bill before the C.B.I. committee has reported.
I greatly hope that this debate and the presentation of the Bill will provide a general background to encourage fuller discussion of this type of problem. I have recently had to resign as Chairman of the Consultative Council of Professional Management Organisations and I know only too well that there is concern about this matter. The type of publicity that my hon. Friend is giving to the subject is extremely useful and I know he will not take it amiss if I urge him to do whatever he can to co-operate with the C.B.I. committee—I hope, to provide evidence for it.
The committee will be able to cover widely all the matters on which my hon. Friend has put his finger. These issues deserve much more discussion than this short debate. In the Government's view, further consideration has to be given to the structure of company boards before any one concept or structure is imposed in company law. It is the view of the Government that it would be difficult to make Amendments to the Bill in Committee and probably impossible to make Amendments to cover the matters which I have mentioned.
I hope that the debate will have been the start of what will prove to be for a long time to come greater attention to the structure and direction of boards of management in British industry. By that I do not mean that there should not be any action for a long time, but even after action has been taken it will still be important to keep the matter under review and to ensure that we obtain the greatest degree of efficiency from management, just as we expect to obtain the greatest degree of efficiency from plant, workers and the whole structure of British industry.
I thank my hon. Friend for introducing the Bill and for speaking as he has, and I hope he will not regard what I have said as being too destuctive.

3.49 p.m.

Mr. Hugh Dykes: Between the remarks of my hon. Friend the Under-Secretary and the spirit and content of the remarks of my hon. Friend the Member for Kensington, South (Sir B. Rhys Williams) in presenting his Bill I suppose I am in an intermediate stratum. I would add my congratulations to those which my hon. Friend the Under-Secretary has given to my hon. Friend the Member for Kensington, South for devising his Bill, which I think, as he suggested himself, is an improvement on the previous Bill which he brought in last year, and that was a Bill with a very worthy aim, a Bill not in any way arival to the whole corpus of company legislation already extant in this country but a very useful supplement to those various pieces of legislation which have sought to increase shareholder protection in publicly quoted companies.
I therefore welcome this Bill in general terms. I welcome it because it aims at an important aspect of control and surveillance of company boards by their shareholders and seeks to fill a gap, as it were, in that part of the structure of the existing legislation. At the same time I freely concede what my hon. Friend the Under-Secretary said when he referred to some of the ways in which the Bill itself, although its spirit and its heart are in the right place, might be deficient in the letter.
I welcome the general aims of the Bill because I believe it relates to what is a very important matter which has been


missed over the years. It is not only in the German Federal Republic but elsewhere that one finds examples of greater protection for shareholders in publicly quoted companies. There has been sufficient discussion in general terms in this country for us now all to be aware that provisions in this direction are probably necessary. There are many elements in, for example, the City of London which would welcome this kind of legislation. I feel that I should declare an interest, a tangential interest, in that I have pursued a career on the Stock Exchange.
Whatever views there may be among different kinds of financial institution in the City of London and elsewhere, and on the Stock Exchange in London and the provinces and in the new federation, it seems clear that over recent years events affecting particular individual companies have been sufficient to enable many to agree that the time has come to get around the table to try to devise a new solution to these problems.
As for the form of solution enunciated in the Bill, I find it attractive although one concedes that there could be argument about a number of details such as the number of non-executive directors to be appointed to a board, the actual definition of a company to have such directors, about the size of the company, and so on, and formulation of the non-executive directors' remuneration and salaries. All these are detailed matters suitable for consideration in discussing whether the Bill should be drawn in a slightly different or tighter way at a subsequent stage if the House were to give the Bill a Second Reading.
However, whatever the actual merits of the details, I think it remains clear, and I should be surprised if there were more than a few hon. Members on either side of the House who would disagree with this, that an additional insurance policy, so to speak, which would arise from a Measure such as this is attractive per se and, moreover, that there are sufficient numbers of people, experts and outside observers as well, who think so to make it worth while giving this matter serious consideration. In that respect, therefore, the Bill helps the public interest.
When one says "public interest" I suppose one thinks of shareholders, and

I suppose that the definition of "shareholders" would in previous years have been very narrow and would have comprised a comparatively narrow number of persons. There are hon. Members, particularly on the Opposition side of the House, who would argue that the value of company shareholders is too narrowly based despite its expansion in recent years. It is an expansion which I have seen in my capacity as one of the representatives of the wider share ownership effort.
There are people who would ask how non-executive directors work. There is still the old style overhang of the classic outside director. One only has to recall those famous and popular cartoon strips of Bristow in the Evening Standard. I remember one in which the chairman wound up the proceedings of the board and said "Thank you, gentlemen; now we will get down to the important business. Please pass the brandy, George." That is the old-fashioned reputation of the non-executive director. But those who are close to reality and acquainted with how they work would pay tribute to the enormously important work which non-executive directors do, whether they represent the financial supporters of a corporate enterprise, whether they represent narrow interests or whether they have come to the board as a result of a particular contract. Although they have been maligned, generally speaking they do a successful job, with obvious exceptions which I shall not go into.
The reality of the shareholder and of the outside director has changed tangibly, and this change has accelerated in recent years. The value of the Bill is that it would, subject to improvement in detail, underwrite and define the ways in which non-executive directors could perform a useful specific function on behalf of shareholders, not in the narrow sense of representing a given section of shareholders, but in the wider sense of being an extra insurance policy which would never apply to the vast generality of publicly quoted companies which go from one year to another without difficulties, internal crises or bad management, but could apply in critical situations when it is clear that an additional safeguard structured in a rational way, as it would be in the Bill, could impinge on a crisis situation and ensure that bad management was either


improved or changed and that shareholders became aware at the earliest formal opportunity of the difficulties and dangers.
What are the protections now? Some of them have been mentioned by my hon. Friend the Member for Kensington, South in introducing the Bill. There are the great institutions. I agree with him when he says that they are often far too reluctant to intervene in the affairs of a company in which they have a shareholding when those affairs are going from bad to worse. There is the Press. I pay tribute to the financial Press, which has become extremely lively, intelligent, acute and fast on the draw in recent years, which is all to the good of the public.
One has the chance of a crisis on a board, with outside directors making public statements. One has the chance of powerful individual shareholders making known their views. One does not have non-executive directors who could formally give a report as outlined in the Bill. In 99 per cent. of cases that might be a formality as dull and unexciting as the annual dreary repetition of the auditors' report, but in the critical minority of cases such a report would be useful. It might be reckoned as a final extreme course of action by the non-executive directors to say that, reluctant as they are, they have to make public in fewer than 1,000 words—or whatever is established—their misgivings about the way the company is run, their extreme anxiety about its future under the present management or their disappointment that changes which they have proposed have not been allowed by the executive directors.
For these reasons the Bill should be given a Second Reading.

Question put and agreed to.

Bill accordingly read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

LEGAL AID AND ADVICE (LOCAL LEGAL CENTRES) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

RESTRICTION OF OFFENSIVE WEAPONS (SWORDSTICKS) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday, 5th May.

PASSENGER FARES (LONDON) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

IMPORTS (MARKING OF ORIGIN) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

EXCLUSION CLAUSES (SERVICES) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday, 5th May.

POWER-BOATS (REGULATION) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

INLAND WATERWAYS (IMPROVEMENT OF NAVIGATION) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

STUDENT UNIONS (REGISTRATION) BILL

Order read for resuming adjourned debate on Second Reading [25th February].

Hon. Members: Object.

Debate further adjourned till Friday next.

ABOLITION OF GAZUMPING AND KINDRED PRACTICES BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

MEDICAL SERVICES (REFERRAL) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

TRANSPLANTS OF HUMAN ORGANS BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

ANTI-DISCRIMINATION BILL

Order read for resuming adjourned debate on Second Reading [28th January].

Hon. Members: Object.

Debate further adjourned till Friday next.

CIGARETTES (PROHIBITION OF ADVERTISING) BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

PROTECTION OF OTTERS (No. 2) BILL

Order for Second Reading read

Hon. Members: Object.

Second Reading deferred till Friday next.

PUBLIC ENTERPRISE DEVELOPMENT AGENCY BILL

Order for Second Reading read.

Hon. Members: Object.

Second Reading deferred till Friday next.

CHRONICALLY SICK AND DISABLED PERSONS (SCOTLAND) BILL

Read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

CIVIL EVIDENCE BILL

Ordered,

That Standing Committee C be discharged from considering the Civil Evidence Bill and that the Bill be committed to a Committee of the whole House.—[Mr. McLaren.]

Committee upon Friday, 28th April.

POLICE BILL

Mr. Gerald Kaufman (Manchester, Ardwick): I beg to move,
That Standing Committee C be discharged from considering the Police Bill and that the Bill be committed to a Committee of the whole House.

It being after Four o'clock and objection being taken to further Proceeding, the debate stood adjourned.

Debate to be resumed upon Friday next.

Adjournment

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Goodhew.]

GOODS (DOUBLE PRICING)

4.3 p.m.

Mr. Greville Janner: I join in congratulating the hon. Member for Honiton (Mr. Emery) on his ministerial appointment. I can only hope that my incursions into the field of his predecessor did not speed his departure, because I formed a warm personal regard for him.
I am pleased to have this opportunity of bringing before the House the subject of the pernicious and growing practice known as double pricing. This is an American practice which has lately invaded the shops of this country and should be driven back across the Atlantic whence it came.
What is double pricing? Briefly, it is the creation of totally fictitious alleged recommended prices at which goods are seldom, if ever, sold. In other words, it is the sending out by manufacturers of totally false, misleading price lists setting out prices which are called "recommended" or "list" or "recommended list" prices but are not recommended to the retailers at all.
The effect of this is that retailers who wish to avoid showing apparent price cuts where there is none are at a grave disadvantage, and I regard this as a matter which should be dealt with through the manufacturers and at the earliest possible date.
Since first raising this matter in the House I have received a flood of helpful letters, comments and advertisements from all over the country, and I wish to deal with certain of the more blatant practices into which I suggest an inquiry is now overdue.
I deal first with those which affect every supermarket in the country and nearly all the ordinary household goods that they sell which are subject to the so-called mark-downs or special offers. I have before me the Daily Mirror of Friday of last week containing its excellent and helpful column called "Mirror Shopping Clock". Last week's article was headed
Cleaning up on the spring-cleaning",
which is a sentiment with which I heartily concur. It shows spring-cleaning items sold by some 10 supermarkets and, in all, about a dozen items. In every case

where there is one the recommended retail price is shown in the first column. But scarcely one single item is sold by one single supermarket at the price allegedly recommended. Woolworth, Tesco, Sainsbury, Pricerite, Pricerite Discount, Key Market, Safeway, the Birmingham Co-op and Finefare are all sellinggoods with an alleged recommended price with cuts ranging from a small amount to as much as 10½p on a a 31½p item.
The items concerned are known to us all: Ajax, Vim, Flash, Windolene, J-cloths, Dettol, Pledge, Mansion oven pads, Dri-Foam cleaners and Brillo. All are household names which should not need to use the sort of promotion relying upon alleged recommended or list prices and then cut-price offers.
The Daily Mirror says in its admirable column:
Has the urge hit you yet?"—
presumably to do some spring-cleaning. I suggest that the time has come for the Government to do some spring-cleaning in the area of these double-priced, alleged, false cut-price offers.
One does not find them only when going to the shops. One gets them through one's door. Every door in the country receives offers, items and vouchers showing ordinary goods at cut prices. If they are genuine cut prices, more strength to the arm of the manufacturer, more credit to the dealer and more strength to the advertisers. I am not attacking genuine advertising. But if the cut-price offer is not cut-price at all, if the special voucher is for a product which is never sold at the original price, if there is a special pack with a flash across it which never was a large pack but is a smaller pack at a lower price, the housewife is being deliberately hoodwinked.
The object of this debate is to persuade the Government to prevent the hoodwinking of unsuspecting housewives. The sums involved may be small to the Government but they are large to the shopper. It is all very well to say that people must shop around. I cannot see housewives in Leicester, especially those who are out at work, taking an expensive bus ride from supermarket to supermarket in order to get 5p off a large Vim or2½p off a Mansion oven pad.


Where there is a genuine promotion the housewife can benefit from it, but she should know what is genuine and what is not. The trouble about ordinary pricing now is that no one can any longer believe the genuine offers.
A prize example was brought to my attention originally by The Cabinet Maker and then exposed by the News of the World. It is now before me in the catalogue of a company called Lay-E-Zee Limited of 280 Bradford Road, Batley, Yorkshire. This company has a whole string of offers on—I regret to say—pink paper. The first is—Golden Cloud, list less 25 per cent. In other words, the company starts with a retail list price of £33·75. That is false, because it says
less 25 per cent., £8·44",
making a cost price of £25·31. Therefore, no retailer buys it even at the list price put out to retailers by the manufacturer.
The advertisement goes on:
Purchase tax, £2·70…Cost plus tax, £28·01. With 60 per cent. profit"—
which is a perfectly proper mark-up for a retailer with his overheads, £44·81. So the recommended price should be £44·81. No doubt at that price the article would be good value.
I emphasise that many of these double priced offers at reduced prices are good value, whereas at the inflated, alleged recommended price they are a hoax. The brochure price is not £44·81, but £69·95. In other words, it is sold for £44·81 and here is a brochure saying that £69·95 is the price. The advertisement goes on:
Suggested retail, £49·95. Advertise: save £20 on a super comfort sprung edge divan set (shows 78 per cent. profit).
So it goes on right the way through— Zenith, list less 20 per cent., Airedale, Bedale, an attractive range of damasks. Then there is something that is straight up another street in which I am interested—"All guaranteed 5 years". What a bed should be guaranteed to do for five years I do not know. Then it says:
Promotional retail prices for divan sets (suggested).
This is a totally improper way of advertising goods which are themselves no doubt perfectly satisfactory and which could be sold and are sold at a proper price without hoodwinking the housewife.

Once somebody starts selling these beds showing vast cuts from the alleged recommended price, he is one up on those who do not do so and many retailers will feel that they must fall in line.
While listening to this afternoon's enthralling debate I have looked through the Evening Standard, which this evening carries a full page advertisement by Shopertunities Limited. In the middle it says this:
Brand new world famous maker's super de luxe vacuum cleaner. Free, complete set of accessories. Over £22 off the price we could charge.
The price that the company could charge is any price. The advertisement says:
Manufacturers are famous household name. Not a cheap model made down to a price",
whatever that may mean. This is no doubt a perfectly good model, but if it was such a sensational bargain at the full price no doubt it would be successfully sold at the full price.
The Yorkshire Post has been kind enough to supply me with details of Status Discount Warehouses, which deals in paint and decorating materials. Here the recommended price is not put. I am told that what this company does is to take the wholesale price, having brought it at a considerably lower price in bulk. It adds 40 per cent. to the wholesale price and calls that the list price or the ordinary price. Having put 40 per cent. on the wholesale price, it proceeds to mark it down having already marked it up, which is another rather curious form of selling goods which are no doubt perfectly satisfactory goods.
Then there are sale offers. In any paper tomorrow there will be found goods offered at half the normal retail price, with the statement that all must be cleared. I suggest to the advertising industry that this is a form of advertising which harms it. No one any more believes the "genuine offers", and whether one is dealing with washing machines, lawn mowers or beds or ordinary detergents much the same applies.
What can be done about this? First we have the Trade Descriptions Act, 1968. In this debate I am not entitled to call for more legislation, neither would I dream of doing so. However, when the


matter was raised before, the Government said they would consider prosecutions. But I am not asking for prosecutions. I am asking the manufacturers to stop doing this before prosecution becomes necessary. I am asking for a full exposure from the Government, through a full inquiry by those who are in a position to carry it out.
Section 11 of the Trade Descriptions Act should be helpful. It says:
If any person offering to supply goods of any description gives, by whatever means, any false indication to the effect that the price at which the goods are offered is equal to or less than—

(a) a recommended price; or
(b) the price at which the goods or goods of the same description were previously offered by him;
or is less than such a price by a specified amount, he shall, subject to the provisions of this Act, be guilty of an offence.
One must not say that goods are sold at less than a recommended price unless they are. I would think that if goods are seldom if ever on sale at a price which is stated to be the recommended price, there is grave peril for those who engage in this practice. However, at the moment it is only possible to collect evidence which is provided by those who have been often fooled by it, and this is a matter which I suggest the Government could profitably take up for the benefit of all except those who engage in the practice. First, it would be of benefit to the retailers concerned, many of whom bitterly resent this practice and do not engage in it, but many who do so feel that it would be better if they did not have to do so in order to fend off the competition from those who do. It would also help the genuine advertiser so that those who read about a sale price or cut price or special offer can accept that they are genuinely getting something at a lower price—not necessarily because the price has been cut. It may be because of the bulk buying operation or a special offer from the manufacturer to the retailer. There are many ways in which real bargains are given.
I am not suggesting that the bargain hunter should be exiled. I want bargains for the housewife, but I also want those who see bargains advertised to be justified in believing what they see. That, after all, is the object of legislation and also, I am sure, the object of

hon. Members on both sides of the House. Above all, it would assist the ordinary housewife who has not got the time or ability to shop around for the odd penny off, who is often fooled by fictitious advertising, who does not know when an offer is or is not genuine and who at present is fooled a great deal of the time.
In the circumstances, I trust that the Minister will give this suggestion his reasonable, careful and thoughtful consideration. I trust he will accept my suggestion and will agree to look into the whole matter and get his Department, which is well equipped, to inquire into this practice. We can then decided what further steps need to be taken to deal with a thoroughly unhappy and unnecessary advertising practice.

4.20 p.m.

The Under-Secretary of State for Trade and Industry (Mr. Peter Emery): I thank the hon. and learned Member for Leicester, North-West (Mr. Greville Janner) for the kind good wishes which he extended to me at the start of his speech. He has drawn our attention to an interesting and topical issue, and I know that the House will be grateful to him for ventilating it in the way he did. However, I am sure that he realises that it is not quite so simple an issue as might be thought from some of his remarks.
I think it will be helpful if I spend a few minutes setting out the framework within which this subject has to be approached, after which I shall deal with the suggestion for an inquiry which the hon. and learned Gentleman made. We must start by recognising that there is not, and, in my view, should not be, uniformity in the costs or in the methods of retailing.
At one extreme, there is the establishment which operates at an expensive central site, having spacious display facilities, offering the maximum service both before and after purchase, maintaining large stocks so that it may deliver promptly, offering a wide range for selection, and, perhaps, having an accounting system which allows credit. At the other end, there is the retailer offering a limited range of what he hopes are fast-moving goods, probably on a self-service cash-and-carry basis. In between there are all sorts of variants.
The price which the retailer charges must inevitably reflect the quality of the service which he sets out to provide, as well as his own efficiency.
By the action which we took in 1964 regarding resale price maintenance—it is to the credit of the Conservative Government that we did it—we set each retailer free to offer whatever combination of price and service he wished to provide. Thereby, we gave the consumer the freedom of choice which we consider is his proper right, freedom not only to choose the goods which suit him best but also to choose the source of supply which offers the combination of service and price which most appeals to him.
The retailer who offers a lower than usual price could, I suppose, simply sit back and wait for the customer to wake up to the fact that his goods were being sold at a price lower than was charged elsewhere. But it is neither helpful to real competition nor convenient for the customer—certainly not for most customers—for the retailer to sit back and just hope that something will happen. He needs to find some way of making known the fact that he is a cheaper source of supply while making clear how cheap a source he is.
For that purpose, reference to the manufacturer's recommended price, if there is one, provides a handy comparison. For example, let us assume that Deluxe Incorporated, a large store in the West End, sells at the recommended price. Mr. Brown proclaims that he sells at £3 less than the recommended price at a store, say, in Leicester. Charlie, in Petticoat Lane, proclaims that he charges £6 under the recommended price. The price relation and the comparative charges are made clear to the potential customer, with a minimum of detailed inspection, when he shops around.
There is, therefore, nothing peculiar or reprehensible—I want this clearly understood—about comparisons with recommended prices so long as such comparisons are honest.

Mr. Greville Janner: Hear, hear.

Mr. Emery: Nor is it any disproof of the honesty of the comparison if some retailers sell at consistently below, perhaps very much below, the recommended

price, so long as there are others who are charging the full recommended price.

Mr. Greville Janner: Hear, hear.

Mr. Emery: The explanation is likely to be that it is a line of goods in respect of which the maximum quality of retailing service is particularly expensive to provide.
The only circumstances in which the practice of comparison with recommended prices is open to question arise where the so-called recommended price is a grossly inflated mark-up. Where this is so, the effect, it seems to me, is clearly to exaggerate the extent to which the retailers price is really a bargain. Whether such an approach to marketing will be successful in the long run or will prove self-defeating is open to question. But I hope that ordinary shoppers are not fooled.
Some goods are habitually sold by retailers for less than the recommended or list price, as is only too obvious if one walks down almost any High Street in the country. There are two conclusions which may be drawn. First, we may think that, if the products of a particular company can always be obtained at less than the manufacturer's apparent estimate of their worth, there must be something wrong with them, since they never should have fetched that price originally. Or we may decide, after examining the goods and deciding they are suitable for our needs, that since every retailer offers a discount the sensible thing is to find the one who offered the highest discount. That is something for the customer to find by shopping around.
It is obviously right that the customer should have some protection against the quotation of a "phoney" recommended price. To do this there are already relevant provisions in the Trade Descriptions Act. It is important to state these in some detail and to explain them because only by doing so would it be possible to see their relevance in the debate. Section 11 states:
If any person offering to supply goods of any description gives, by whatever means, any false indication to the effect that the price at which the goods are offered is equal to or less than…a recommended price…or is less than such a price by a specified amount, he shall, subject to the provisions of this Act, be guilty of an offence.


The section goes on to lay down that, unless the contrary is expressed, an indication of a recommended price shall be treated as an indication that it is a price recommended by the manufacturer or producer. This is of particular importance to the signs and displays seen around the country and is an indication that it is a price recommended generally for supply by retail in the area where the goods are offered.
The section says that anything likely to be taken as an indication as to the recommended price is to be treated as an indication. This seems fairly obvious but it needs to be stated. Perhaps it might even be suggested that it sounds involved, but it needs to be put quite clearly.
It should be noted that a person advertising goods as available for supply is to be taken also as offering those goods for sale. The hon. and learned Member will understand the import of this in the legal context. Of course, only the courts can decide how this bears in a particular case but it seems clear that if a comparison is made with some price which, however described, is likely to be taken as meaning the recommended price, the Act can be brought to bear if it is not the price which the manufacturer has recommended.
This is a matter of some importance. If the manufacturer, though describing it as a list or recommended price, also makes it clear to the retailer that it is not one which he expects the retailer to charge—and this may well cover some of the examples given by the hon. and learned Member—the Act will apply. If more than one price is recommended to different retailers in the area the Act would also operate.
The question remains as to what the situation would be if it could be shown that though a manufacturer firmly recommended a price it was set so high that no one did or could, by custom of the trade, expect to charge that price. This again is an example we have had before us—where the recommended price was set artificially high. If in that way it was established that the recommendation could not have been made in good faith could it really be claimed that the price recommended came within the meaning of Section 11(3)? This is not a matter which has been decided in the courts and it is

not for me to hazard a guess as to the outcome if such a case was brought. I would be a fool so to do. But before it has been put to the test I do not think we should assume that the Act could not deal with the cases brought up in this debate; in other words, those instances in which comparison is made with a flagrantly exaggerated recommended price which nobody charges or is likely to charge.
However, if someone did charge that recommended price, it would be difficult to say that that was not genuine. Therefore, it is my view that what is needed is not a general inquiry into double pricing, which I believe would add little to our present commonsense appreciation, which has been so ably expressed by the hon. and learned Gentleman, but individual inquiries into particular cases with a view to finding out whether they involve any contravention of the existing provisions of the Trade Descriptions Act, and, if so, whether it could be appropriate to bring a case before the courts.
The right people to carry out such inquiries are the local weights and measures authorities, who are under a statutory duty to enforce the Act and have all the necessary powers to carry out such inquiries. Obviously, however, they must expect to look to the trade for assistance in this matter. I hope that all who have made their views known to the Press and others will produce to their local weights and measures authorities the hard evidence, so that inquiries can be made.
I willingly accept that retailers themselves are just as furious about spurious offers as are the customers who are taken in. Whilst I believe that the vast majority of shops and retailers wish to be fair, the Government wish to ensure that retailers do not deceive the public. Such a practice is contemptible and should be utterly condemned. Therefore, I am willing to give notice today that the Government will give every encouragement to local authorities so that anyone who is minded to practise such a trick must recognise that the full power of the Trades Descriptions Act is liable to be used against him.
I hope that one result of our debate will be to put traders and shoppers on notice of this fact. It should encourage them to let their local weights and


measures authorities know of any examples of the practice which they have encountered. The public must help to provide this information so that inquiries can be made and then, if the allegations can be established, prosecutions take place.
The Government are determined that the consumer shall not be taken for a ride.

Question put and agreed to.

Adjourned accordingly at twenty-eight minutes to Five o'clock